Which of the Following Statements About Fiscal Policy and Aggregate

question 254

Multiple Choice

Which of the following statements about fiscal policy and aggregate supply is CORRECT?

• A) The focus of fiscal policy and aggregate supply is to minimize unemployment.
• B) Fiscal policies that influence aggregate supply don't always require tradeoffs between price levels and output.
• C) Fiscal policies that influence aggregate supply take less time to work than do demand-side fiscal policies.
• D) Fiscal policies that influence aggregate supply increase inflationary pressures as output expands.

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Definitions:

Payroll Taxes

Charges applied to employers or their workers, typically measured as a fraction of the earnings paid by companies to their employees.

Direct Labor

The labor costs of workers who are directly involved in the production of goods or the rendering of services.

Direct Labor Hour

A measure of the amount of time workers spend directly manufacturing a product.

Direct Materials

Raw materials that can be directly traced to the production of specific goods or services and are significant in cost.