If the political leaders of a country want to promote economic growth, which of the following policy alternatives would be most effective?
a. imposition of price controls on agricultural products in an effort to keep food cheap
b. a public-sector investment program financed by highly progressive taxation
c. low taxes, a monetary policy consistent with long-run price stability, and the abolition of price controls and trade restrictions
d. expansionary monetary policy designed to keep interest rates low
C
You might also like to view...
When we compare PAE and actual output (Y) the macroeconomic variable we generally use to directly assess their equivalence is:
A. capital expenditure. B. inventories. C. unemployment. D. interest rates.
Which of the following would be considered an example of structural policy?
A. An attempt to reduce the government budget deficit by reducing spending. B. Provision of additional cash to the banking system. C. A reduction in income tax rates. D. A decision by a developing country to reduce government control of the economy and to become more market-oriented.