Starting from long-run equilibrium, a large decrease in government purchases will result in a(n) ________ gap in the short-run and ________ inflation and ________ output in the long-run.
A. expansionary; lower; potential
B. expansionary; higher; potential
C. recessionary; lower; potential
D. recessionary; lower; lower
Answer: C
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Over time, the percentage of total employment in services has ________ and in agriculture, employment has ________
A) increased; increased B) decreased; increased C) stayed about the same; decreased D) stayed about the same; increased E) increased; decreased
If income distribution in an economy is perfectly equal, the lowest quintile will earn 20% of total income
Indicate whether the statement is true or false
Which of the following is an implication of deflation:
(a) Savings are discouraged; (b) Exports are more expensive; (c) Reduction in business revenue; (d) Excessive wage demands.
Dividends are
A) the portion of a corporation's profits that are distributed to stockholders. B) the portion of a corporation's revenues that are distributed to bondholders. C) bonuses given to managers of corporations, to ensure that the managers perform in the way that stockholders want. D) taxes on the profits of corporations.