The basic goal of economics is to
What will be an ideal response?
address the scarcity problem created because the population's desire for goods exceeds the ability to produce them
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If a country's imports of goods and services exceeds its exports, ________.
A. GDP equals the sum of consumption, investment, and government purchases B. net exports are positive C. GDP is less than the sum of consumption, investment, and government purchases D. GDP exceeds the sum of consumption, investment, and government purchases
The current account surplus
A) is a decreasing function of disposable income and an increasing function of the real exchange rate. B) is an increasing function of disposable income and an increasing function of the real exchange rate. C) is an increasing function of disposable income and a decreasing function of the real exchange rate. D) is a decreasing function of disposable income and a decreasing function of the real exchange rate. E) is an increasing function of disposable income and a decreasing function of aggregate demand.
If the MPC = 0.8, an increase in investment spending from $35 billion to $38 billion will increase real GDP by
A) $3 billion. B) $3.75 billion. C) $15 billion. D) $24 billion.
The availability of substitutes makes the demand for a good less elastic
a. True b. False