Economists who believe in activist policy making argue that
A) only planned changes in the money supply impact the economy.
B) only increases in the minimum wage levels improve economic well-being.
C) decreases in aggregate demand definitely impact the economy in the short run.
D) decreases in aggregate demand impact the economy only in the short run.
Question 2
If firms receive an economic forecast predicting future decreases in the growth of real GDP, they are likely to respond by
A) increasing their level of investment spending to increase future production capacity.
B) increasing their level of investment spending to increase current production capacity.
C) decreasing their level of investment spending to decrease current production capacity.
D) decreasing their level of investment spending to decrease future production capacity.
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