Name two actions that a government could take if it wants to implement an expansionary fiscal policy
What will be an ideal response?
increase government spending, decrease taxes.
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The national debt is the total amount the ________ government has borrowed to make expenditures that ________ tax revenue
A) federal; exceed B) state and local; exceed C) state and local; are less than D) federal; are equal to E) federal; are less than
Externalities can be corrected by each of the following except
a. self-interest. b. moral codes and social sanctions. c. charity. d. normal market adjustments.
Which of the following is true when there is excess demand for a product in a market?
a. Price must be above the equilibrium price. b. Price will tend to fall. c. Producers will reduce output and sales will fall. d. Price must be below the equilibrium price.
Suppose that the Fed purchases a $1,000 government bond from you. If you deposit the entire $1,000 in your bank, what is the total potential change in the money supply as a result of the Fed’s action if reserve requirements are 10 percent?
A. $10,000 B. $5,000 C. $3,000 D. $2,000