An inflationary gap is the amount by which aggregate expenditures ____ the amount required to achieve full-employment equilibrium GDP
a. exceed
b. equal
c. fall short of
d. are greater than
a
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If the realized real interest rate in an economy is 6%, the nominal interest rate is 8%, and the expected inflation rate is 8%, then the realized inflation rate in the economy is:
A) 2%. B) 4%. C) 8%. D) 6%.
The price elasticity of supply is calculated as the
A) percentage change in quantity supplied multiplied by the percentage change in price. B) percentage change in quantity supplied divided by the percentage change in price. C) percentage change in price divided by the percentage change in quantity supplied. D) percentage change in quantity supplied plus the percentage change in price.
In the table above, what does the private sector surplus equal?
A) $500 billion B) $350 billion C) $150 billion D) $0
A result of a positive externality in the production of a good is that
A) the price system will over-allocate resources to the production of that good or service. B) the price system will under-allocate resources to the production of that good or service. C) the market supply will be too high. D) the market demand will be too high.