Reference no: EM13797821
1. If taxes are cut, then consumption
a: falls, aggregate expenditure falls, and output falls.
b: falls, saving increases, investment increases, and output increases.
c: increases, aggregate expenditure increases, and output increases.
d: increases, aggregate expenditure decreases, and output decreases.
e: increases, aggregate expenditure increases, and output decreases.
2. A laissez-faire attitude toward most markets is most closely associated with
a: Keynesians.
b: monetarists.
c: classical economists.
d: supply siders.
e: Reaganomics.
3. In the classical model, the supply of loanable funds is
a: provided through saving by households.
b: positively related to the interest rate.
c: perfectly inelastic.
d: provided through saving by households and positively related to the interest rate.
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