A tariff is which type of tax?
(a) Progressive
(b) Regressive
(c) Proportional
(d) Neutral
Question 2Across national economies which of the following is the most important source of variation in growth rates?
A) labor growth
B) capital growth
C) productivity growth
D) government regulation
Question 3Under the Employment Act of 1946, what action did the federal government take for the first time in U.S. history?
(a) Assuming power and responsibility for managing the world economy
(b) Assuming power and responsibility for managing the U.S. economy
(c) Relinquishing all influence for managing the U.S. economy to state governments
(d) Relinquishing all influence for managing the U.S. economy to the private sector
Question 4Real business cycle theorists agree with new classical economists that
a. agents maximize utility and form expectations rationally.
b. the labor market do not clear.
c. imperfect information plays a big role in business cycles.
d. Both a and c
Question 5The comparative advantage of the South was in
(a) small farms producing for the local market.
(b) plantation agriculture producing for export.
(c) manufacturing.
(d) shipbuilding and trades related to shipbuilding.
Question 6During Japan's economic slump in the early 1990s, monetary policy:
a. was highly effective at stimulating income.
b. was caught in a liquidity trap as a result of high inflation and interest rates.
c. was ineffective because of a liquidity trap caused by near zero interest rates.
d. was never even attempted.
e. was the cause of the slump.
Question 7Ricardian Equivalence theory assumes that ________.
A) an anticipated increase in the income of future generations will reduce the amount that is saved today on their behalf
B) government spending remains constant
C) many people are subject to borrowing constraints
D) tax cuts have a positive impact on aggregate supply
Question 8From the net tax function: T = t0 + t1Y, where t0 < 0 and t1 > 0, it follows that, as income rises
a. average taxes falls and the surplus declines.
b. average taxes rises and the deficit increases.
c. average taxes falls and the deficit declines.
d. Average taxes and the deficit do not change.
Question 9From 1789 to 1838, state banks
(a) served as financial intermediations and paid out paper money to borrowers.
(b) were corporations.
(c) engaged in agricultural activities.
(d) established demand deposits against which checks could be written by the borrower.
Question 10According to the classical model, changes in aggregate demand are driven by
a. changes in taxes.
b. changes in borrowing and lending.
c. changes in fiscal policy.
d. demand curve to the left and increases the price level.
Question 11During World War II, price controls were necessitated as shortages emerged in consumer markets. This required
(a) the federal government to ration goods through tickets.
(b) the federal distribution of rationing points.
(c) a forced reduction in private consumption.
(d) all of the above actions.
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