What effect does the increase of the price of gasoline have on the cost curves of package delivery firms such as Federal Express or United Parcel Service? How might the effects differ for a software firm such as Symantec that uses the Internet?
Please provide the best answer for the statement.
Gasoline is a major input used in businesses involved in package delivery such as Federal Express or United Parcel Service. Increases in the price of gasoline leads to increases in their short-run average variable costs, marginal costs and average total costs of these firms. All of these curves would shift upward. Software firms such as Symantec that make heavy use of the Internet for their business are less likely to be affected by the increased price of gasoline because it is not a major component of their costs of production. In this case, the short-run cost curves will probably show little change.
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Automatic stabilizers are an example of discretionary fiscal policy.
a. true b. false
By the end of the 1960s, fiscal activism was falling out of favor due to its long ________ lag and, as predicted by the permanent-income hypothesis, the ________ of the 1968 tax surcharge
A) legislative, ineffectiveness B) legislative, overstimulation C) effectiveness, ineffectiveness D) effectiveness, overstimulation