Consider the Following Events: Event 1: Growth in the World

question 77

Multiple Choice

Consider the following events: Event 1: Growth in the world economy slows.
Event 2: The world price of oil rises.
Event 3: Canadian labour productivity declines.
Choose the statement that is correct.

• A)A classical macroeconomist and a monetarist recommend that taxes be kept low to avoid disincentive effects for all of the events and a Keynesian recommends active fiscal policy and monetary policy to offset all events.
• B)All macroeconomists believe that the economy requires active fiscal policy and monetary policy to keep the economy out of recession.
• C)A classical macroeconomist and a monetarist recommend an increase in the quantity of money for all events.
• D)A Keynesian recommends no action for all of the events.
• E)A Keynesian recommends active fiscal policy but not monetary policy for events 1 and 2 and monetary policy but not fiscal policy for event 3.

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Definitions:

Western Portrait

A genre of painting that originated in the Western world, focusing on the depiction of an individual or group’s appearance and personality.

Jan van Eyck

A Northern Renaissance artist known for his detailed panel paintings and mastery of oil painting techniques, including the Ghent Altarpiece.

Revelations

A book of the New Testament of the Christian Bible, traditionally called the Book of Revelation or Apocalypse, which contains prophetic visions of the end times.

Ghent Altarpiece

A large and complex 15th-century polyptych altarpiece in St Bavo's Cathedral, Ghent, Belgium, attributed to the brothers Hubert and Jan van Eyck.