To meet its obligations, the federal government must consider four alternatives: ________ income taxes ________ Social Security taxes ________ Social Security benefits ________ federal government discretionary spending
Fill in the blank(s) with the appropriate word(s).
Raise
Raise
Cut
Cut
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In an economy where aggregate spending is given by Y = 5,500 + 0.6Y - 20,000r, the interest rate is currently 2 percent (0.02). If potential output equals 8,000, the central bank must ________ the interest rate to close the ________ gap.
A. raise; expansionary B. raise; recessionary C. lower; recessionary D. lower; expansionary
The goals of monetary policy tend to be interrelated. For example, when the Fed pursues the goal of ________, it also can achieve the goal of ________ simultaneously
A) high employment; economic growth B) stability of financial markets; a low current account deficit C) high employment; lowering government spending D) economic growth; a low current account deficit
Which of the following is an example of a natural monopoly?
a. Government b. The railway system c. An internet service provider d. An automobile manufacturer
If the long-run supply curve in a perfectly competitive industry is upward sloping, this is because
A) firms are different. B) firms are identical. C) input prices rise as the industry expands. D) Either A or C.