Policies That Stimulate or Depress the Economy Without Any Deliberate

question 74

Multiple Choice

Policies that stimulate or depress the economy without any deliberate policy change are called:

• A) leading indicators.
• B) time-inconsistent policies.
• C) rational expectations policies.
• D) automatic stabilizers.

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Definitions:

Material Cost

The expense incurred in acquiring the raw materials needed to produce a good or deliver a service.

Holding Cost

Holding cost is the expense associated with storing unsold goods or items held in inventory over a certain period, including warehousing, insurance, and depreciation costs.

Economies of Scale

The cost advantage achieved by an increase in production volume that leads to a reduction in per-unit costs.

Cycle Inventory

The portion of inventory available due to the batching of orders, which rotates regularly and is used to meet consumer demand between replenishments.