A carbon tax on fossil fuels is likely to cause the price of goods produced by firms that use fossil fuels to:

Nonactivists believe that ________

A) there is a very rapid self-correcting mechanism since prices and wages are very flexible B) lags to policy implementation are so long that even the "correct" policies may lead to undesirable consequences C) policy interventions should take place less frequently than what Keynesians advocate D) all of the above E) none of the above

Suppose the economy is at an equilibrium when C + I + G + X = $12 trillion. If the economy is currently at a real national income level of $14 trillion, then total planned real expenditures

A) exceed real Gross Domestic Product (GDP), and real Gross Domestic Product (GDP) will increase. B) are less than real Gross Domestic Product (GDP), and real Gross Domestic Product (GDP) will decline. C) are equal to real Gross Domestic Product (GDP), and there will be no change in real Gross Domestic Product (GDP). D) are less than real Gross Domestic Product (GDP), and real Gross Domestic Product (GDP) will increase.