The government is able to alter the outcome of the three basic economic questions (what? how? and for whom?) by ______________, _________________, and ___________.
Fill in the blank(s) with the appropriate word(s).
taxing; spending; regulating (any order)
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In the new Keynesian models,
a. imperfect competition comes is the result of optimizing behavior by individuals. b. perfect competition is assumed with respect to the product market c. a natural monopoly is presumed for the product market. d. both a and c. d. None of the above
Which of the following is a tenet of supply-side economics?
A. High marginal tax rates severely discourage work, saving, and investment. B. Increases in social security taxes and other business taxes shift the aggregate supply curve to the right. C. The Federal Reserve should adhere to a monetary rule that limits increases in the money supply to a 5 percent annual rate. D. Transfer payments increase incentives to work.