Supply-siders argue that:
a. reductions in government spending cut infrastructure investment which hurts private sector investment.
b. increases in government spending increase infrastructure investment which helps private sector investment.
c. increases in government spending causes private sector investment to fall because the government pushes up interest rates.
d. reductions in government spending cause private sector investment to fall because the government pushes up interest rates by borrowing.
e. increases in government spending causes consumption spending to fall because the government purchases push up interest rates.
c
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If the Fed decided to reverse its policy actions implemented during the heart of the recession, the Fed would be acting to try to prevent
A) an increase in deflation. B) a decrease in unemployment. C) an increase in inflation. D) an increase in unemployment.
The rational-ignorance effect is a result of
a. externalities that lead to an excess supply of information. b. the limited incentive of the news media to cover political campaigns. c. the expectation of individual voters that their vote will not be decisive. d. the lack of a college education on the part of most voters in the United States.