Which of the following statements is an example of a positive, as opposed to normative, statement?
a. Americans deserve a cleaner environment.
b. Reducing emissions reduces days missed from school due to asthma.
c. All Americans are entitled to quality health care.
d. Economic policies should focus on improving equality.
b
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Starting from long-run equilibrium, a war that raises government purchases results in ________ output in the short run and ________ output in the long run.
A. lower; potential B. higher; potential C. higher; higher D. lower; higher
The study of economics is best described as a study of
A) capitalism. B) the factors that influence the stock and bond markets. C) the choices made in producing goods and services. D) how people earn a living. E) coping with scarcity, and choices made as a result of scarcity in a society.
Assume that the expectation of a recession next year causes business investments and household consumption to fall, as well as the financing to support it. If the nation has low mobility international capital markets and a fixed exchange rate system, what happens to the net nonreserve international borrowing/lending balance and the monetary base in the context of the Three-Sector-Model? a. The
net nonreserve international borrowing/lending balance becomes more negative (or less positive) and monetary base falls. b. The net nonreserve international borrowing/lending balance becomes more negative (or less positive) and monetary base rises. c. The net nonreserve international borrowing/lending balance becomes more positive (or less negative) and monetary base falls. d. The net nonreserve international borrowing/lending balance and monetary base remain the same. e. There is not enough information to determine what happens to these two macroeconomic variables.
Two bonds, one a 30-year bond and the other a 1-year bond, have the same interest rate. If the interest rate in the economy falls, the value of the:
A. long-term bond falls by more than the value of the short-term bond falls. B. long-term bond rises by more than the value of the short-term bond rises. C. short-term bond falls by more than the value of the long-term bond falls. D. short-term bond rises by more than the value of the long-term bond rises.