The real exchange rate generally has ______ relationship with aggregate expenditure.
A. a negative
B. a positive
C. no
D. a constant
A. a negative
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The economy pictured in the figure has a(n) ________ gap with a short-run equilibrium combination of inflation and output indicated by point ________. 
A. recessionary; A B. recessionary; C C. recessionary; B D. expansionary; A
In the Keynesian model, fluctuations in aggregate spending cause:
A. enhanced labor market mobility. B. changes in potential output. C. recessions and expansions. D. changes in average labor productivity.
Which of the following makes demand less elastic?
A) the existence of many close substitutes for the good B) spending a large proportion of income on the good C) a short time elapsing since the product's price changed D) All of the above answers are correct.
The government safety net creates both an adverse selection problem and a moral hazard problem. Explain
What will be an ideal response?