Which of the following is a topic studied in macroeconomics?
A) how the wheat industry determines how much wheat to grow
B) the effect on economic growth if the government raises taxes
C) the impact of labor unions on wages
D) the pricing decisions in the computer hardware industry
E) the impact of higher prices for gasoline on the number of SUVs people buy
B
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Starting from long-run equilibrium, a large decrease in government purchases will result in a(n) ________ gap in the short-run and ________ inflation and ________ output in the long-run.
A. expansionary; lower; potential B. expansionary; higher; potential C. recessionary; lower; potential D. recessionary; lower; lower
The greatest appeal of U.S. Treasury securities is that
A) they have high yields. B) they have no default risk. C) the U.S. Treasury will repurchase them at any time. D) their market prices fluctuate very little.
The MPC on ________ income is less than the MPC on ________ income according to ________ theory
A) transitory; permanent; Friedman's B) transitory; permanent; Modigliani's C) permanent; transitory; Modigliani's D) permanent; transitory; Friedman's
If events in a single country cause its economic activity to move up or down through a business cycle, what difference(s) might it make that the economy is closely integrated with other economies in the world?
What will be an ideal response?