Suppose Current Government Spending Decreases and That Individuals Expect Future

question 30

Multiple Choice

Suppose current government spending decreases and that individuals expect future government spending to decrease. Given this information, in which of the following cases will output in the current period be more likely to decrease?

• A) Individuals consider only the short- run effects of changes in future macro variables when forming expectations of future output and future interest rates.
• B) Individuals consider only the medium- run effects of changes in future macro variables when forming expectations of future output and future interest rates.
• C) Individuals consider only the long- run effects of changes in future macro variables when forming expectations of future output and future interest rates.
• D) The output effects will be the same in A and C.
• E) The output effects will be the same in B and C.

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Definitions:

Discrimination

Unjust or prejudicial treatment of individuals or groups based on characteristics such as race, age, sex, or disability.

Large Pool

A term often used to describe a substantial group of candidates, resources, or data from which selections can be made.

Careers Section

A designated area, often on a company's website, where job openings are posted, and information about career opportunities is provided.

Internet Recruiting

The practice of using online platforms and tools, such as job boards and social media, to advertise vacancies and attract potential candidates for employment.