If Decision Makers Adjust Fully to Demand Stimulus Policies, Persistent

question 123

Multiple Choice

If decision makers adjust fully to demand stimulus policies, persistent expansionary macro-policy will lead to

• A) inflation with no lasting reductions in unemployment.
• B) a permanent reduction in unemployment.
• C) lower interest rates.
• D) more rapid economic growth.

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Definitions:

Profitability

The financial metric that measures the degree to which a business or activity yields profit or financial gain.

Quarterly Return

The Employer’s Quarterly Federal Tax Return, a form submitted to the IRS every 3 months that summarizes the federal income and employment taxes withheld from employees’ paychecks.

Revenue

The total income generated from goods sold or services provided by a business, which can be before or after any deductions are made.

Expenses

Money spent or cost incurred in an entity's efforts to generate revenue, representing the cost of doing business.