Based on the graph showing the effects of a government budget surplus, how would a budget surplus affect the equilibrium quantity of loanable funds exchanged?
a. It would create a higher equilibrium quantity of loanable funds exchanged.
b. It would create a lower equilibrium quantity of loanable funds exchanged.
c. It would have no influence on the equilibrium quantity of loanable funds exchanged.
d. It would drive the equilibrium quantity of loanable funds exchanged to zero.
a. It would create a higher equilibrium quantity of loanable funds exchanged.
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In the business cycle, what immediately precedes the time when real GDP is falling?
A) depression B) peak C) recession D) expansion E) trough
According to the theory of rational expectations, the economy always remains at the natural rate of unemployment, irrespective of policy changes
a. True b. False Indicate whether the statement is true or false
An increase in injections into the economy may lead to:
a) An outward shift of aggregate demand and demand-pull inflation b) An outward shift of aggregate demand and cost-push inflation c) An outward shift of aggregate supply and demand-pull inflation d) An outward shift of aggregate supply and cost-push inflation
The figure above shows the demand and cost curves facing a price-setting firm. In profit-maximizing (or loss-minimizing) equilibrium, the Lerner index is ________, and the elasticity of demand is ________.
A. 0.5; -2.0 B. 0.667; -1.5 C. 0.6; -1.667 D. 1.33; -0.75 E. 1 ; -1