Which of the following was an important source of economic stability during the two decades following the recovery from the 1982 recession?
a. countercyclical fiscal policy instituted by Congress
b. a substantial increase in government spending as a share of the economy
c. monetary policy that kept the inflation rate low and relatively steady
d. balanced federal budgets throughout the period
C
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The marginal propensity to consume (mpc) is the:
A. percentage by which disposable income increases when consumption increases by 1 percent. B. amount by which disposable income increases when consumption increases by $1. C. percentage by which consumption increases when disposable income increases by 1 percent. D. amount by which consumption increases when disposable income increases by $1.
In the short run, a contractionary fiscal policy would cause
a. the AD curve to shift to the right b. equilibrium real GDP to decrease and the price level to increase c. the AS curve to shift left d. the economy to slide along the AD curve e. equilibrium GDP and the price level to fall
Factor mobility aids in economic development when
A. There is an increase in both outsourcing and insourcing. B. A region suffers a natural disaster such as an earthquake or tornado. C. A technological advance causes some firms to go out of business. D. All of the choices are correct.
Profit-maximizing employment is the quantity of labor at which
A. marginal factor product is equal to product price. B. marginal revenue product is equal to marginal factor cost. C. marginal factor cost is equal to marginal revenue. D. marginal revenue product is equal to product price.