If an inflationary boom exists, the appropriate fiscal policy is to:
a. increase the budget deficit.
b. increase government spending and hold taxes constant.
c. decrease government spending and/or raise taxes.
d. hold government spending constant and decrease taxes.
c
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The more substitutable current consumption is with future consumption, the more likely it is that an increase in the interest rate will cause an increase in savings.
Answer the following statement true (T) or false (F)
The goal of the business firm is maximization of ____, and the goal of the consumer is maximization of ____.
A. total sales; income B. total profit; utility C. total output; utility D. total sales; utility
Use the above table. Assuming constant opportunity costs, if countries Alpha and Beta specialize based on comparative advantage, then
A) Alpha should specialize in knives and Beta should specialize in forks. B) Alpha should specialize in forks and Beta should specialize in knives. C) Alpha should specialize in producing both items. D) Beta should produce both items.
Which of the following best defines positive externalities?
a. Beneficial spillovers to a third party b. Monetary benefits to stakeholders c. Dollar values of societal benefits d. Rates of return for innovators