Economists who focus their analyses on the effects of a change in the money supply and velocity are called
A. realists.
B. Keynesians.
C. supply siders.
D. monetarists.
Answer: D
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Potential GDP in the United States
A) declines over time. B) changes over a given business cycle. C) does not change over time. D) grows as the economy grows.
GDP includes:
a. the negative attributes from erosion and deforested landscape. b. all quality improvements resulting from higher quality goods replacing inferior goods. c. the cleaning-up expenses associated with pollution. d. the value of leisure time. e. the illegal activities related to the underground economy.
Crowding out occurs when
a. increased taxes force higher levels of national saving. b. deficit spending by the government forces private investment spending to contract. c. local businesses cannot get government contracts because of the higher bids of large corporations. d. foreign investors are willing to pay higher prices for U.S. bonds than American citizens will pay.
Which of the following is correct? When actual leakages exceeds expected injections, then:
a. Inventories rise, unemployment tends to rise, and prices tend to fall. b. Inventories rise, unemployment tends to fall, and prices tend to rise. c. Inventories fall, unemployment tends to rise, and prices tend to rise. d. It is impossible for these two to be unequal. e. You are mixing apples and oranges. These two macroeconomic variables should not be compared.