The economic impact of automatic stabilizers during recessionary periods is to
A. increase taxes.
B. have no impact on the recession.
C. moderate the recession.
D. make the recession worse.
Answer: C
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How can a new deposit of $10,000 at one bank create other new deposits at other banks? Suppose the desired reserve ratio is 10 percent and people keep no currency outside of the banks
What will be the new amount of deposits in the second and third rounds?
In the figure above, suppose the economy is initially at point B. If people come to believe that the exchange rate will fall in the future, the supply of dollars ________ and the market moves to point such as ________
A) decreases; A B) decreases; E C) increases; D D) increases; C
If the quantity of Good Y is measured on the vertical axis, the quantity of Good X is measured on horizontal axis, the price of Good X is $50, the price of Good Y is $20, and the budget is $500, the vertical intercept of the budget line is
A. 25, the horizontal intercept is 10, and the slope is -0.4. B. 20, the horizontal intercept is 50, and the slope is -0.4. C. 10, the horizontal intercept is 25, and the slope is -2.5. D. 50, the horizontal intercept is 20, and the slope is -2.5.
Production possibilities in an economy decrease as more resources and better technology are utilized.
Answer the following statement true (T) or false (F)