Data on annual percentage changes in real GDP, consumption, and investment in the United States shows that fluctuations in investment _____.
a. are noticeably smaller during expansions than during recessions
b. are roughly similar to fluctuations in consumption
c. are roughly similar to fluctuations in GDP
d. are closely followed by economic forecasters because those fluctuations often signal that a recession will occur
e. account for most of the variability in GDP
Question 2
An example of the command-and-control approach to environmental policy is:
a. placing a tax on freon to reduce its use and the corresponding CFC emissions (which contribute to the ozone hole).
b. requiring car producers to install new air conditioners that do not use freon.
c. allowing coal producers to buy and sell permits to allow CFC emissions.
d. allowing individuals to sue freon producers if CFC emissions exceed a government-set standard.
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