The income flow in the form of resource payments from firms to households, and in the form of revenue from households to firms, is known as the circular flow of money
Indicate whether the statement is true or false
T
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Starting from long-run equilibrium, a war that raises government purchases results in ________ output in the short run and ________ output in the long run.
A. lower; potential B. higher; potential C. higher; higher D. lower; higher
Refer to Table 10-3. The table above shows Lee's marginal utility from consuming ice cream cones and cans of Lime Fizz Soda. Select the phrase that completes the following statement
"We can determine the number of ice cream cones and cans of Lime Fizz Soda Lee should consume to maximize his utility A) if we know the values of the marginal utility per dollar for ice cream cones and Lime Fizz Soda." B) by adding up the marginal utilities for ice cream cones and Lime Fizz Soda." C) if we know what Lee's income is." D) if we know what Lee's income is and the price of an ice cream cone and the price of a can of Lime Fizz Soda."
A consumption good that would NOT be counted in GDP would be:
A. the coffee Cyndi buys on her way to work in the morning. B. Cyndi's brand new car. C. the sunglasses Cyndi bought on clearance sale yesterday. D. Ford company’s purchase of steel.
If people start to use cash because of an increase in credit card fraud, which of the following would we expect to happen under a neutralization policy?
a. The money supply would decrease, real GDP would not change, and the interest rate would not change. b. The money supply would increase, real GDP would not change, and the interest rate would not change. c. The money supply would decrease, real GDP would increase, and the interest rate would decrease. d. The money supply would increase, real GDP would not change, and the interest rate would decrease. e. The money supply would decrease, real GDP would decrease, and the interest rate would not change.