Which of the following is an example of a transaction that is made even though complete information is not possible?
A. Joe buys a puppy in hopes that the puppy will be his hiking companion for the next 20 years.
B. Alex buys house insurance and has never filed a claim.
C. Mike saves his money by putting it in a mutual fund.
D. All of these are examples of transactions that must be made with incomplete information.
D. All of these are examples of transactions that must be made with incomplete information.
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With a decrease in government expenditure we
A) move up along the aggregate demand curve. B) move down along the aggregate demand curve. C) shift the aggregate demand curve to the right. D) shift the aggregate demand curve to the left.
Refer to the above figure. Suppose the economy is at point A. By the proper use of fiscal policy, the government can
A) boost taxes to shift LRAS through point A. B) increase government spending to get the economy to point B. C) raise income tax rates to get the economy to point C. D) reduce government spending to get the economy to point D.