Shoppers stimulate discount stores
As the economy remains weak, shoppers flock to discount stores for low prices. In June, Walmart's sales were up 5.8 percent and Costco Wholesale's sales were up 9 percent. Analysts attributed the increase in sales to the government's tax credits, which increased consumers' disposable incomes and consumers sought the biggest bang for their economic stimulus bucks.
Source: CNN, July 10, 2008
At what type of macroeconomic equilibrium would the government want to use such a policy?
Question content area bottom
Part 1
The government uses the policy of tax credits when the economy is _______.
A. at full employment only
B. either at full employment or below full employment
C. either at full employment or above full employment
D. above full employment only
E. below full employment only
