In the basic Keynesian model, an increase in government purchases:
A. increases potential output.
B. increases short-run equilibrium output.
C. reduces short-run equilibrium output.
D. reduces potential output.
Answer: B
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A shortage occurs when the market price is lower than the equilibrium price
Indicate whether the statement is true or false
Federal employment in the United States is dominated by what two functions?
A. National defense and postal service. B. Health care and police. C. Postal service and education. D. Health care and national defense.
Refer to the information provided in Table 8.8 below to answer the following question(s). Table 8.8Number of Fruit BasketsTFCTVCTCMC0$100 $0$100 --11002012020210030 13010310042 14212410062 16220510092 192306 100136 236 44Refer to Table 8.8. Assume that Polynesian Fruit sells fruit baskets in a perfectly competitive market. The market price of a fruit basket is $30. To maximize profits, Polynesian Fruit should sell ________ fruit basket(s) and their profit is ________.
A. five; -$42 B. three; -$52 C. zero; $0 D. two; -$70
Your best friend calls and gives you the latest stock market "hot tip" that he heard at the health club. Should you act on this information? Why or why not?
What will be an ideal response?