As a result of the increased deficit associated with discretionary fiscal policy, _____
a. both the interest rate and real output fall
b. both the interest rate and nominal output rise
c. the interest rate falls and real output rises
d. the interest rate rises and real output falls
e. nominal output rises, real output falls, and the interest rate rises
b
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The negative effect of having more potential volunteers resulting in a reduced likelihood of a beneficial outcome is known as the
A) diffusion effect. B) externalizing effect. C) group dynamic effect. D) size effect.
Which of the following sets of goods might, under the right circumstances, be substitutes for water?
A) Milk and juice B) Beer and wine C) Stones and bricks D) A, B, and C above are all potential substitutes for water. E) A and B above are potential substitutes for water, but C (stones and bricks) can never be substitutes for water in the real world.