The Clinton Administration, faced with eight years of uninterrupted prosperity was chronically worried about inflation and thought of applying countercyclical fiscal policy but was nervous about doing so because
a. it was politically incorrect to raise taxes
b. it was politically incorrect to cut government spending
c. countercyclical policy had never worked before
d. it didn't know where the economy would be in six months and was afraid that the countercyclical policy they would introduce would be an inappropriate one
e. there was no administrative lag that it can use to implement the policy
D
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Refer to Figure 5-15. The current market equilibrium output is partly the result of overfishing. In that case, what does S1 represent?
A) the social marginal cost of harvesting salmon B) the social marginal benefit of harvesting salmon C) the private marginal cost of harvesting salmon D) the private marginal benefit of harvesting salmon
When government agencies become privatized:
A. they are sold to private companies. B. stock is created and sold to the public. C. private stock is sold to private households. D. they are rarely regulated.