First, briefly explain what is meant by the policy mix. Second, explain what effect different policy mixes might have on the level of output, investment, and the interest rate
What will be an ideal response?
The policy mix refers to the possible combinations of monetary (exp. or contr.) and fiscal (exp. or contr.) that can be simultaneously implemented. There are a number of different answers that could be given to the latter part of the question. The effects on output, the interest rate, and investment will depend on the type of mix.
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In early 1996, Congress passed the "Freedom to Farm Bill.". Following the bill's enactment,
a. farmers found that competition from international agriculture declined. b. farm prices rose steadily for the next 4 years. c. agriculture was completely deregulated, and farmers began to operate without any government subsidies or assistance. d. farm prices fell, leading Congress to authorize emergency payments to farmers in 1998 and 1999.
Accounting profit is defined as
a. total revenue minus opportunity cost b. total revenue minus all costs of production c. total revenue minus explicit costs d. the sum of marginal revenues received from all units produced e. the difference between marginal revenue and marginal cost