A Policy Rule

question 120

Multiple Choice

A policy rule

• A)is another term for discretionary policy.
• B)pertains only to fiscal policy.
• C)is another term used to describe automatic fiscal policy.
• D)applies only to monetary policy.
• E)pertains to both automatic and discretionary policy.

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Definitions:

Marginal Revenue

The heightened revenue from selling an additional unit of a product or service.

Perfectly Competitive Firm

A theoretical concept describing a company that operates in a market where no single producer or consumer has the market power to influence prices.

ATC

Average total cost (ATC) is the total cost of production divided by the quantity of output produced, representing the cost per unit of output.

Marginal Cost

The supplementary expense involved in creating an additional unit of a product or service.