Countercyclical fiscal policy is viewed by most economists
a. as the perfect instrument for preventing boom and bust economies
b. as a useful but imperfect instrument for reacting to boom and bust economies
c. having no impact in the short run or long run.
d. doing more damage than good in both the short run and long run.
e. as having an impact only in the long run.
B
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Jenny's weekly income increases from $500 to $650. As a result, she goes out for dinner one day a week instead of one day every other week. What is Jenny's income elasticity of demand for restaurant dinners?
What will be an ideal response?
A newly acquired microwave oven and a food processor will increase Chuck's productivity in the kitchen. Accordingly, he will
a. cook more and eat out less b. cook less and eat out more c. buy more ready-to-eat foods d. be more likely to hire a cook e. increase the quality of what he cooks but may or may not cook more