When the housing bubble popped, the effect of the negative demand side shock and the negative supply side shock were the same on:
A. output, causing it to definitely decrease.
B. prices, causing them to definitely rise.
C. output, causing it to definitely increase.
D. prices, causing them to definitely fall.
Answer: A
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An income tax to pay for national defense can approximate a _____ if there is a close relationship between income and _____
a. user charge; wealth b. unit tax; wealth c. user charge; consumption d. sales tax; consumption
Aggregate demand can be defined as:
a. the total spending by all consumers, business firms, government agencies, and foreigners in the United States. b. the total amounts that all consumers, business firms, government agencies, and foreigners wish to spend on all final goods and services at various price levels. c. the total spending by consumers, business firms, and government agencies in one year. d. the total spending by consumers, business firms, and government agencies on final goods and services.