Historical evidence seems to indicate that
A. budget and trade deficits generally move in the same direction.
B. there is no consistent relationship between trade and budget deficits.
C. trade and budget deficits decrease when the president is a Republican, and increase when the president is a Democrat.
D. budget and trade deficits generally move in the opposite direction.
Answer: A
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An industry in which the firm's cost structures do not vary with changes in production will have a long-run supply curve that
A. is perfectly elastic. B. slopes downward. C. is perfectly inelastic. D. slopes upward.
A wage offer that is above the market wage, intended to avoid the adverse selection problem, is called a(n)
a. efficiency wage b. union wage c. selection wage d. spurious wage e. opportunity cost wage
Which of the following statements about exchange rate is most likely correct?
a. Exchange rates will affect imports and exports but not aggregate demand in the economy. b. Exchange rates will affect imports and exports and thus affect aggregate demand in the economy. c. Exchange rates will affect imports and exports and thus affect aggregate supply in the economy. d. Exchange rates do not affect imports and exports or aggregate demand in the economy.
The long-run upward-sloping aggregate demand curve implies an upward-sloping Phillips curve; thus, there is a tradeoff between inflation and unemployment in the short run when it comes to government policy.
Select whether the statement is true or false. A. True B. False