"Even if there is a liquidity trap or interest-insensitive investment, a falling price level will increase the real money supply and real wealth, and this impacts consumption"
This is a statement a __________ economist might make as an explanation of why the economy __________ pull itself out of a recession. A) Classical; will
B) Classical; may not be able to
C) Keynesian; will
D) Keynesian; may not be able to
A
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To increase workers' incomes, the City of New York's government set a wage below which it is illegal for employers to pay employees. This wage is referred to as the
A) union wage. B) government wage. C) efficiency wage. D) minimum wage. E) city wage.
According to supply-side economics, a cut in taxes will affect total tax revenue, because ________
A) the level of productivity should fall precipitously with a tax cut B) a tax cut will be followed by an even larger decrease in government spending C) of the resulting increase in saving D) of the positive impact on the level of income