Expansionary Fiscal Policy Is Ineffective If

question 80

Multiple Choice

Expansionary fiscal policy is ineffective if

• A) there are idle resources in the economy.
• B) the MPC is less than 0.60.
• C) the government has a budget surplus.
• D) there is complete crowding out.
• E) a and d

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Definitions:

Percentage Discount

A reduction from the original price of goods or services, expressed as a percentage of the original price.

Cash Customers

Consumers who pay for goods or services with cash at the time of purchase, rather than using credit.

Inventory Turnover

A ratio indicating how many times a company's inventory is sold and replaced over a specific period.

Receivables Period

The amount of time it typically takes for a business to collect payments owed by its customers after selling its goods or services on credit.