Expansionary fiscal policy is incapable of solving the underlying problem of a negative real shock. Which of the following problems also makes it difficult to use fiscal policy to combat a negative real shock?
A. The problem of timeliness of fiscal policy
B. The problem of crowding out of private spending
C. All of these problems make it difficult.
D. The problem of targeting fiscal policy
Ans: C. All of these problems make it difficult.
Economics
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Refer to Figure 2-15. In the circular flow diagram, economic agents M represent
A) firms. B) product markets. C) factor markets. D) households.
Economics
If consumers view the output of any firm in a market to be identical to the output of any other firm in the market, the demand curve for the output of any given firm
A) will be identical to the market demand curve. B) will be horizontal. C) will be vertical. D) cannot be determined from the information given.
Economics