Which of the following is a component of aggregate demand?
A. Consumption
B. Net exports
C. Investment
D. All of these are components of aggregate demand.
Answer: D
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When private expenditures decrease as a result of increased government spending, this is known as
A) the multiplier effect. B) the stabilizer effect. C) government deficit spending. D) the crowding out effect.
The total producer surplus in the entire market is given by the:
A) product of the individual seller's surplus. B) sum of all the individual sellers' producer surplus. C) area between the market supply curve and the market demand curve. D) area between the market demand curve and the price line.
As the multiplier process works through time, the size of the multiplier effect becomes
A. larger. B. smaller. C. constant. D. explosive.
It is difficult for depositors to know the true health of banks because:
A. regulations prohibit banks making their financial statements publicly available. B. banking is competitive and financial records of banks are not divulged to prevent competitor banks from having an advantage. C. most of the information on bank loans is private and based on sophisticated models. D. the financial statements of banks are too difficult for most people to understand.