Which of the following is not a weakness of fiscal policy as a tool of economic stabilization?
a. It is ineffective in dealing with stagflation
b. Its correct implementation depends on an accurate estimate of potential output.
c. It is subject to lags.
d. It affects only aggregate demand but does not have any impact on aggregate supply.
e. Households may not respond to changes they perceive as permanent.
e
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Since Poland joined the European Union in 2004, many young and educated Poles have emigrated to the United Kingdom. As a result, the labor supply curve in the United Kingdom shifts to the right and the equilibrium wage rises
Indicate whether the statement is true or false
Jill earns an income of $2,000 a week and goes out to dinner 4 times a week. If her income increased to $2,100 she would go out to dinner 5 times a week. Jill's income elasticity of demand is
A) 0.22 B) 4.56 C) 2.28 D) -0.22