Which of the following policies followed by the Clinton administration were not Keynesian policies?
a. Reducing the budget deficit during a strong expansion.
b. Concentrating tax increases on upper income households.
c. Attempting to increase government spending in 1992 when the U.S. economy was below its natural rate of output.
d. Adjusting capital gains taxes for inflation in order to encourage savings.
D
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Holding nominal money balances constant, a decrease in the price level
A) causes the real value of the money balances to increase, thereby increasing the interest rate. B) generates a reduction in the value of the money balances, leading to higher interest rates and a decrease in total planned real expenditures. C) causes the real value of the money balances to increase, in turn increasing total planned real expenditures. D) causes the real value of the money balances to decrease, in turn decreasing total planned real expenditures.
An indifference curve represents combinations of two goods that provide an individual the same total utility.
Answer the following statement true (T) or false (F)