To combat unemployment the government should use fiscal and monetary policies to
a. run a deficit and increase the money supply.
b. run a deficit and decrease the money supply.
c. run a surplus and increase the money supply.
d. run a surplus and decrease the money supply.
Answer: b. run a deficit and decrease the money supply.
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Who receives benefits if regulation works according to social interest theory?
A) the entire economy B) cohesive interest groups C) everyone not in the cohesive interest group D) the regulators E) It is impossible to determine who benefits.
In the above figure, the long-run average cost curve exhibits diseconomies of scale
A) between 5 and 10 units per hour. B) between 10 and 20 units per hour. C) between 20 and 25 units per hour. D) along the entire curve.
The Federal Reserve wants to reduce the nation's money supply. This could be accomplished by doing all of the following EXCEPT
A. decreasing the discount rate. B. increasing the reserve requirement. C. selling securities on the open market. D. making banks hold a reserve for all types of deposits.
If two firms pollute, and the increase in costs to Firm A from decreasing pollution is equal to the decrease in costs to Firm B from increasing pollution:
A. the firms cannot benefit from trading the right to pollute. B. the firms can benefit by trading the right to pollute. C. while both firms can benefit from trading, there is no way for them to determine an agreeable price. D. both firms will stop polluting.