When all prices are set equal to marginal costs,
a. consumers buy more than they should.
b. consumers will get less utility.
c. markets are giving correct signals to consumers.
d. producers make excessive profits.
c
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In the short run, a change in the nominal exchange rate brings an equivalent change in the real exchange rate
Indicate whether the statement is true or false
The Great Depression of the 1930s, with a large number of workers and factories unemployed, would be represented in a production possibilities frontier graph by
A) a point outside the frontier. B) an intercept on either the vertical or the horizontal axis. C) a point inside the frontier. D) a point on the frontier.
The burden of debt is borne by future generations.
A. True B. False C. Uncertain
The natural employment deficit ________ be used to determine the effectiveness of discretionary fiscal policy actions because ________
A) cannot; it excludes non-discretionary spending changes B) can; it includes non-discretionary spending changes C) cannot; it includes non-discretionary spending changes D) can; it excludes automatic stabilization expenditures