Based on our understanding of the IS-LM model that takes into account dynamics, we know that a reduction in government spending will cause
A) an immediate drop in Y and immediate increase in i.
B) an immediate reduction in i and no initial change in Y.
C) a gradual reduction in i and gradual reduction in Y.
D) a gradual reduction in i and an immediate reduction in Y.
C
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Refer to Figure 13-9. Which of the graphs in the figure depicts a monopolistically competitive firm that is earning economic profits?
A) Panel A B) Panel B C) Panel C D) Panel A and Panel B
When drawn against the real interest rate, output supply increases if
A) current government expenses increase. B) future government expenses increase. C) current total factor productivity increases. D) the money supply increases.
If the U.S. experiences an enormous surge of immigration, we could predict it would make the labor supply:
A. decrease and shift to the right. B. increase and shift to the right. C. increase and shift to the left. D. decrease and shift to the left.
Maureen's college raises the cost of room and board per semester. This increase raises Maureen's opportunity cost of attending college
a. even if the amount she would have to pay for room and board if she didn't attend college rose by the same amount. An increase in opportunity cost reduces Maureen's incentive to attend college. b. even if the amount she would have to pay for room and board if she didn't attend college rose by the same amount. An increase in opportunity cost increases Maureen's incentive to attend college. c. only if the amount she would have to pay for room and board if she didn't attend college rose by less than the increase in the amount her college charges. An increase in opportunity cost reduces Maureen's incentive to attend college. d. only if the amount she would have to pay for room and board if she didn't attend college rose by less than the increase in the amount her college charges. An increase in opportunity cost increases Maureen's incentive to attend college.