Currently, virtually the entire deficit in the U.S. is

Which of the following is a fiscal policy that would increase aggregate demand in the Keynesian model?

a) a decrease in personal income taxes b) a decrease in government spending c) an increase in corporate income taxes d) a purchase of government bonds by the federal reserve e) a sale of government bonds by the federal reserve

Suppose the demand curve for hybrid cars shifts to the right. This will cause a relatively small increase in the price of hybrid cars if

A) both demand and supply are inelastic. B) demand is elastic and supply is inelastic. C) demand is inelastic and supply is elastic. D) both demand and supply are elastic.