1. Supply-side economics stress that: a. aggregate demand is the major determina
ID: 1255062 • Letter: 1
Question
1. Supply-side economics stress that:a. aggregate demand is the major determinant of real output andaggregate employment.
b. tax rates are not a major determinant of real output andaggregate employment.
c. an increase in government expenditures financed by higher taxrates will cause RGDP to
rise.
d. marginal tax rate changes can exert a significant impact onRGDP, even in the long run.
2. The federal government funds deficit spending by:
a. issuing bonds.
b. redeeming bonds.
c. increasing taxes.
d. providing and selling government services.
3. The crowding-out effect implies that:
a. increases in government purchases will reduce consumptionpurchases.
b. higher taxes reduce both consumption and saving.
c. fiscal policy effects on interest rates will be offset bymonetary policy.
d. increases in government purchases may increase interest ratesand thereby reduce
investment.
4. Expansionary fiscal policy can lead to a decline in net exportsbecause:
a. it increases interest rates, increasing the exchange value ofthe dollar and decreasing net
exports.
b. it increases interest rates, decreasing the exchange value ofthe dollar and decreasing net
exports.
c. it decreases interest rates, increasing the exchange value ofthe dollar and decreasing net
exports.
d. it decreases interest rates, decreasing the exchange value ofthe dollar and decreasing net
exports.
5. One major problem with some commodity monies is that:
a. to be useful, money must be divisible.
b. to be useful, money must be storable.
c. to be useful, money must be of uniform quality.
d. to be useful, money must be durable.
e. all of the above are problems with commodity monies.
6. Paper money in the U.S. is:
a. fiat money.
b. more than half of M2.
c. partially backed by gold and silver in Fort Knox.
d. convertible into specie (gold or silver) at the holder'srequest.
e. both a. and b.
Explanation / Answer
2.B 3.D 4.A 5.D 6.C Hope it helps good luck!Related Questions
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