Automatic stabilizers
A) increase the problems that lags cause in using fiscal policy as a stabilization tool.
B) are changes in taxes or government spending that increase aggregate demand without requiring policymakers to act when the economy goes into recession.
C) are changes in taxes or government spending that policymakers agree to when the economy goes
into recession.
D) are part of discretionary fiscal policy.
Answer: B) are changes in taxes or government spending that increase aggregate demand without requiring policymakers to act when the economy goes into recession.
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Which of the following represent the Federal Reserve's most important responsibilities?
a. Supervise and regulate banks. b. Issuing paper currency. c. Printing paper currency. d. Both (a) and (b) e. Deciding the maximum rate banks can charge for loans.
The price elasticity of supply is __________ elastic over time because ___________.
A. less; producers get accustomed to the price changes B. less; the ideal number of firms have time to move into or out of the industry C. more; producers have a longer time to adjust their production decisions D. more; producers get accustomed to the price changes