Appleville is a village that specializes in all forms of apple products. Suppose that each winter, when no apples are being produced, the aggregate output falls below the long-run output level. What type of fiscal policy might be most effective to correct this problem?
A) Reducing taxes in order to decrease aggregate demand.
B) Increasing government spending in order to increase aggregate demand.
C) Decreasing government spending in order to increase aggregate demand.
D) Increasing taxes in order to increase aggregate demand.
Ans: B) Increasing government spending in order to increase aggregate demand.
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a schedule or curve showing the relationship between the price level index and the amount output produced in the economy
What will be an ideal response?
Double markups refer to the tendency of the:
A. manufacturer and the distributor to increase the product's price above the average cost. B. distributor to increase the product's price by more than the manufacturer. C. manufacturer and the distributor to increase the product's price above the marginal cost. D. manufacturer to increase the product's price by more than twice the marginal cost.
Which of the following is a possible solution to the adverse selection problem?
a. Screening b. Signaling c. All of the above d. None of the above
Cost-benefit analysis can be applied to individual decision-making and public choice theory
a. True b. False Indicate whether the statement is true or false