A recessionary gap exists when the level of full-employment output exceeds the equilibrium level of output
Indicate whether the statement is true or false
T
You might also like to view...
The importance of the ceteris paribus assumption is that it: a. allows one to separate normative economic issues from positive economic ones
b. allows one to generalize from the whole to the individual. c. allows one to analyze the relationship between two variables apart from the influence of other variables. d. allows one to hold all variables constant so the economy can be carefully observed in a suspended state.
According to New Trade Theory,
a) international trade is not a zero-sum game, but a win-win proposition b) a nation can create new comparative advantages by subsidizing key industries c) protectionism is justified in order to allow “infant industries” to mature d) competitiveness is an inappropriate model for countries to follow in foreign trade e) trade wars benefit society by raising the level of competitiveness
The consumption schedule shows:
A. that the MPC increases in proportion to GDP. B. that households consume more when interest rates are low. C. that consumption depends primarily on the level of business investment. D. the amounts households intend to consume at various possible levels of aggregate income.
Trade barriers that restrict imports from developing countries tend to be:
A. Highest in the capital goods and technology sectors of those economies B. Lowest in the labor-intensive manufacturing sectors of those economies C. Lowest for those products in which DVCs have a comparative advantage D. Highest for those products in which DVCs have a comparative advantage