A Specific Reduction in Government Spending Will Dampen Demand-Pull Inflation

question 17

Multiple Choice

A specific reduction in government spending will dampen demand-pull inflation by a greater amount, the:

• A)smaller is the economy's MPC.
• B)flatter is the economy's aggregate supply curve.
• C)smaller is the economy's MPS.
• D)less the economy's built-in stability.

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Definitions:

Circuit Switching

A method of communication where a dedicated channel or circuit is established for the duration of a transmission between two endpoints.

PGP

Pretty Good Privacy, an encryption program that provides cryptographic privacy and authentication for data communication.

Handshaking

In a connection-oriented protocol, the process of exchanging control packets before exchanging data packets.

Packet Switching

A method of grouping data into packets that are transmitted over a network and can travel independently to their destination.