A Social Welfare Function That Is to Be Germane to the Evaluation

question 23

Multiple Choice

A social welfare function that is to be germane to the evaluation of macroeconomic policy should be constructed to depend on

• A) instrumental variables.
• B) final target variables.
• C) intermediate target variables.
• D) some combination of final and intermediate target variables.
• E) all of the above.

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Definitions:

Federal Budget Deficit

The deficit occurring when government spending surpasses income within a specific budget year.

Unemployment Rates

The measure of the unemployed in the labor force who are seeking job opportunities.

Economic Downturn

A period of poor economic performance across a country or region, often characterized by a decline in GDP, employment, and trade.

Japanese Reindustrialization

The period or process of Japan revitalizing its industrial sector, focusing on high technology, efficiency, and export-oriented production.