Suppose Congress increased spending by $100 billion and raised taxes by $100 billion to keep the budget balanced. What will happen to real equilibrium GDP?
A) Real equilibrium GDP will fall.
B) Real equilibrium GDP will rise.
C) There will be no change in real equilibrium GDP.
D) Real equilibrium GDP will initially rise, but then fall below its previous equilibrium value.
Answer: B
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In the perfectly competitive market, all firms in the market are assumed to be producing:
a. identical products. b. differentiated products. c. products that are heavily advertised. d. complementary products.
Modern economics as a field of study is usually thought to have begun with which of the following
What will be an ideal response?
The present value of $1 received n years from now is found by dividing 1 by _______.
Fill in the blank(s) with the appropriate word(s).
If bond prices fall,
A) interest rates rise, which in turn, discourage investment. B) interest rates fall, which in turn, discourage investment. C) interest rates rise, which in turn, stimulate investment. D) interest rates fall, which in turn, stimulate investment.