In preparing their estimates of the stimulus package's effect on GDP, Obama administration economists estimated a government purchases multiplier of 1.57
Economist Robert Barro argues that ________, the government purchases multiplier would be lower than the administration's estimate, and economists Lawrence Christiano, Martin Eichenbaum, and Sergio Rebelo argued that ________, the multiplier would be higher than the administration's estimate.
A) during wartime; when short-term interest rates are near zero
B) during a recession; when the inflation rate is relatively low
C) when the unemployment rate is high; when the value of the dollar is depreciating against foreign currencies
D) when the federal budget is in surplus; when government transfer payments are declining
A
You might also like to view...
The focus of the Ricardian model is on how differences in _________ influence international trade patterns.
a. demand b. comparative costs c. absolute costs d. transportation costs
Which of the following is a fair bet based on the toss of an unbiased coin?
A) head: receive $5, tail: lose $5 B) head: receive $2, tail: lose $3 C) head: receive $0.5, tail: lose $1 D) head: lose $3, tail: lose $3