When the government is heavily involved in the regulation of business activity, entrepreneurs will be encourage to spend more time and resources on
a. research and the development of better products.
b. keeping their production costs low.
c. rent seeking.
d. productive activities and less on political lobbying.
C
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Imagine that the government increases its spending by $75 billion. Which of the following by itself would tend to make the change in aggregate demand different from $75 billion?
a. both the multiplier effect and the crowding-out effect b. the multiplier effect, but not the crowding-out effect c. the crowding-out effect, but not the multiplier effect d. neither the crowding out effect nor the multiplier effect
Logan finds $10 in his jacket pocket and deposits it into a bank. As a result of this single transaction, M1 has:
A. increased by $10. B. increased by more than $10. C. increased by less than $10. D. not changed.