Assume that business investment spending rises, and the increase is funded by greater borrowing in the capital markets. If the nation has low mobility international capital markets and a fixed exchange rate system, what happens to the real GDP and reserves account in the context of the Three-Sector-Model?
a. Real GDP rises and reserves account becomes more positive (or less negative)
b. Real GDP rises and reserves account remains the same.
c. Real GDP and reserves account remain the same.
d. Real GDP rises and reserves account remains the same.
e. There is not enough information to determine what happens to these two macroeconomic variables.
.A
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The following table provides information about production at the XYZ-TV Company.Number of WorkersTVs ProducedMarginal ProductValue of Marginal Product00------13535$35,00026833$33,00039931$31,000412829$29,000515527$27,000How many workers will XYZ-TV Company hire if the going wage for TV production workers is $32,000?
A. 0 B. 1 C. 2 D. 3
The end of a recession is called the:
A. boom. B. expansion. C. trough. D. peak.
The assumption of completeness means that
A) the consumer can rank all possible consumption bundles. B) more of a good is always better. C) the consumer can rank all affordable consumption bundles. D) all preferences conditions are met.
Which of the following actions results in the shortest lag between recognition of a problem and an appropriate stabilization response?
A. Congress writes legislation providing more automatic stabilizers in the economy. B. Congress provides limited authority to the president to alter fiscal or monetary policy for the purpose of stabilization. C. The appropriation and authorization responsibilities of Congress are transferred to the executive branch in order to eliminate congressional lags. D. Congress takes authority over stabilization and is not required to wait for the executive branch to respond.