What are some of the likely consequences of price ceilings on agricultural inputs?
What will be an ideal response?
As with output, a price ceiling on an input will create a shortage, but if the government subsidizes the producer of the input, the result will be inefficiency in production and overuse of the input.
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Some economists believe that financing deficit spending by increasing taxes will lead to a lower level of national consumption and a higher level of national savings than deficit spending. The reason is
A) that people do not realize that taxes have increased also. B) the interest rate on the debt will increase. C) people will forgo private consumption now as society substitutes government goods for private goods. D) people believe that they can consume the government provided goods and have future generations pay the bill.
The business cycle that results from the election campaign of incumbent politicians is called a:
a. monetary business cycle. b. time consistent business cycle. c. political business cycle. d. real business cycle. e. historical business cycle.