What actions would a supply-side economist advocate to cure an inflationary situation?
What will be an ideal response?
A supply-side economist would advocate shifting the aggregate supply curve to the right to reduce inflationary pressures. This could be accomplished by reducing taxes and government regulations to decrease costs for producers; by encouraging saving, which would reduce consumption; and by reducing import barriers, which would allow foreign goods to meet some of the demand for goods.
You might also like to view...
The market value of downtown real estate is most basically determined by the
A) assessment of the taxing authorities. B) market value of the building already on a particular plot of land. C) use to which it is currently being put. D) uses to which people would like to put it if given a chance. E) whatever it costs to convert the land to its next best use.
A situation in which the price charged is less than society's opportunity cost would lead to
A) too little being produced. B) too much being produced. C) an efficient amount being produced. D) marginal cost pricing.
Suppose research indicates that the effects of a one degree increase in Earth's average temperature would be much more devastating than previously believed. Therefore, the greater the marginal benefit of reducing greenhouse gases, other things constant,
a. the lower the optimal level of emissions b. the higher the optimal level of emissions c. the likelier that the level of emissions would have no effect d. the lower the optimal level of cleaner air e. None of the answers is correct
A monopoly is a
a. price taker b. single buyer of an input into production c. firm facing a perfectly elastic demand curve d. group of firms controlling the price and output for an industry e. price setter