A change in economic output is potentially efficient
A. only if no one is made worse off.
B. if the value of the resulting gains exceeds the value of the resulting losses.
C. if the value of the resulting gains exactly equals the value of the resulting losses.
D. if the value of the resulting gains is less than the value of the resulting losses.
Answer: B
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If a policy change by the Fed is ________, then the change in policy has exactly the same result on the economy as it does when we assume that households and firms have adaptive expectations
A) unannounced or not credible B) unannounced or credible C) announced or credible D) announced or not credible
SNAP (food stamps) and Medicaid are examples of:
a. money transfers b. resource earnings c. in-kind transfers d. tax expenditures
The law of increasing opportunity costs implies that a society's production possibilities curve will be a straight line
a. True b. False Indicate whether the statement is true or false
The Classical view of the economy is characterized by:
a) A laissez-faire approach. b) The belief that demand creates its own supply. c) Overt fiscal policy. d) The inherent instability of the economy.