Assume that if there was no crowding-out, an increase in government spending would increase GDP by $100 billion. If there had been partial crowding-out, however, then GDP would have:
A. Increased by more than $100 billion
B. Increased by less than $100 billion
C. Increased by $100 billion
D. Not increased
D. Not increased
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Which one of the following is TRUE?
A) New growth theory suggests that there is no connection between the level of education in a country and its rate of economic growth. B) New growth theory suggests that education benefits only those people who receive it, and not the population as a whole. C) Investments in secondary education produce gains in the form of economic growth. D) Secondary education does not boost economic growth in developing nations, because so much of the workforce remains in agriculture.
Brand loyalty in monopolistically competitive markets manifests itself as
A) upward sloping marginal cost curves. B) downward sloping demand curves. C) downward sloping marginal cost curves. D) upward sloping demand curves.
According to economist Milton Friedman, a. the short-term validity of the Phillips curve is questionable
b. there might be a short-term trade-off between unemployment and inflation but not a permanent trade-off. c. trade-off happens between unemployment and inflation happens in the long run but not in the short run. d. the long-run trade-off between unemployment and inflation comes from unanticipated inflation.
How do most people respond when their disposable income increases?
a. They spend all of the increase. b. They save all of the increase. c. They save some and spend some. d. They neither spend nor save.