Which of the following is true with regard to the use of countercyclical fiscal policy as a stabilization tool?
a. Successful fiscal policy would be easy to achieve if Congress had greater access to forecasting tools.
b. Successful fiscal policy is difficult to achieve because Congress acts slowly and our ability to predict the future is limited.
c. Successful fiscal policy is easier to achieve today because econometric forecasting models are highly accurate.
d. Congress and the President have persistently altered fiscal policy in a stabilizing manner.
B
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The ability to make a credible commitment is necessary for the first mover to gain an advantage in a sequential game
Indicate whether the statement is true or false
Refer to Figure 8.3. Holding other variables constant, if the economy is originally in equilibrium at the intersection of D1 and S1 and firms experience an increase in technology of production, the economy would move to the new equilibrium point
represented by A) w1 and L2. B) w3 and L2. C) w2 and L2. D) w2 and L3.