Robinson Crusoe's decision to produce more capital goods and fewer consumer goods in a given period causes:
a. a decrease in the resources available in its economy.
b. an increase in economic growth in future periods.
c. a decrease in economic growth in future periods.
d. no change in the availability of resources in its economy.
e. a decrease in the ability to produce goods in the next period.
b
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An increase in expected inflation causes the real interest rate to ________ and output to ________ in the short run, before prices adjust to restore equilibrium
A) rise; rise B) rise; fall C) fall; rise D) fall; fall
Suppose a price ceiling is set above the equilibrium price. Now suppose that policy makers decide to raise the price ceiling. This increase in the price ceiling will cause which of the following to occur?
A) The surplus in the market will increase. B) The surplus in the market will decrease. C) The shortage in the market will increase. D) none of the above
Spending on new goods and services out of a household's current income is
A) consumption. B) the capital consumption allowance. C) savings. D) investment.
When economists speak of the demand for money, they refer to the amount of money people would like to hold
a. given that it can only be printed slowly b. in the best of all possible worlds c. in their bank accounts rather than their wallets d. at each interest rate e. rather than spend