If the economy is in recession and the number of used baby clothing stores increases, then:
a. used baby clothes are a necessity.
b. used baby clothes are an inferior good.
c. used baby clothes are a normal good.
d. new baby clothes are a luxury.
e. used baby clothes have price-elastic demand.
b
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Movements in GDP
A) differ greatly from movements in GNP. B) do not differ greatly from movements in GNP. C) are not allowed to differ at all from movements in GNP by definition. D) need to be inflation adjusted in order to match movements in GNP. E) are not relevant to an examination of national income.
Investment demand is downward sloping because as the interest rate decreases,
A) each project's internal rate of return decreases. B) each project's internal rate of return increases. C) more projects will have an internal rate of return that exceeds the interest rate. D) more projects will have an internal rate of return that is less than the interest rate.
When aggregate expenditure exceeds the level needed to generate a full-employment, noninflationary equilibrium, then a recessionary gap exists
Indicate whether the statement is true or false
Substitutes
What will be an ideal response?