Which of the following statements is true?
A) In a price support program, consumers end up paying the price support.
B) In a target price system, consumers end up paying the target price.
C) In a target price system, the per-unit deficiency payment is equal to the difference between the quantity demanded at the market price and the quantity supplied at the market price.
D) Acreage allotment programs directly (as opposed to indirectly) raise agricultural product prices.
E) b and d
A
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If the government increased defense spending by $1 million and laid off enough Justice Department employees to decrease the Department of Justice budget by $1 million, which of the following is the likely net effect?
a. An increase in the budget deficit and transfer payments b. An increase in the budget deficit and net taxes c. An increase in the budget deficit and government spending d. No change in the budget deficit because there is no net change in government spending e. No change in the budget deficit because neither defense spending nor the Department of Justice is included in government spending
The Phillips curve traces a set of combinations of rates of:
a. interest and unemployment. b. real GDP and inflation. c. real GDP and interest. d. inflation and interest. e. unemployment and inflation.