Let S = y - (100 + 0.5y). Assume no government or foreign sectors. At the equilibrium level of income, y* = 800, the level of saving is
A) 0. B) 50. C) 100. D) 300.
D
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If aggregate output is below its equilibrium level ________
A) there is an excess demand for goods B) actual output is below planned expenditure C) firms will tend to replenish their low inventories driving output up toward equilibrium D) all of the above E) none of the above
Suppose an economics professor receives a $10,000 royalty check from a foreign publishing company and deposits the amount in a local bank. This transaction would be recorded as:
a. a $10,000 credit entry in the domestic services account. b. a $20,000 debit entry in the domestic capital account. c. a $20,000 debit entry in the domestic capital account. d. a $10,000 credit entry in the domestic capital account. e. a $10,000 debit entry in the domestic services account.
Money prices are:
A. always the best way to solve economic problems. B. essential to a coordinating mechanism. C. unfair ways of coordinating individual actions. D. not essential to a coordinating mechanism.
Economic science tries to design mechanisms to coordinate people's actions better.
Answer the following statement true (T) or false (F)