Firms that expend resources for lobbying that could have been used for productive services are engaging in rent-seeking behavior.
Answer the following statement true (T) or false (F)
True
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Answer the next question based on the following list of factors that are related to the aggregate demand curve. 1) Real-Balances Effect2) Household Expectations3) Interest-Rate Effect4) Personal Income Tax Rates5) Profit Expectations6) National Income Abroad7) Government Spending8) Foreign Purchases Effect9) Exchange Rates10) Degree of Excess CapacityA change in net export spending would most likely be caused by changes in ________.
A. 5 and 6 B. 2 and 3 C. 7 and 8 D. 6 and 9
When one party to a transaction knows more than the other, ________ is said to exist
Fill in the blank(s) with correct word
The theory of rational expectations concludes that
A. by reacting to the expected effects of a stabilization policy, the public will tend to negate the impact of that policy. B. the public's expectations as to the effects of economic policies will tend to reinforce the effectiveness of those policies. C. the public's expectations can influence the outcome of fiscal policy, but not of monetary policy. D. the public's expectations can influence the outcome of monetary policy, but not of fiscal policy.
Using Figure 1 above, if the aggregate demand curve shifts from AD1 to AD2 the result in the long run would be:
A. P1 and Y2. B. P2 and Y2. C. P3 and Y1. D. P2 and Y3.