Given full-employment output = $2,800, equilibrium real GDP = $2,500, and MPS = 0.25, which of the following changes would most likely bring the economy to a full-employment level of real GDP?
A. $300 decrease in taxes.
B. $75 increase in government spending.
C. $75 decrease in taxes.
D. $75 decrease in government spending.
Answer: B
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Based on the above table, if the current price level is 100 and the unemployment rate is 4 percent, then the
A) expected inflation rate is 8 percent. B) inflation rate is 2.8 percent. C) expected inflation rate is 2.8 percent. D) inflation rate is 8 percent. E) inflation rate is 108 percent.
To promote economic efficiency, government should
a. keep all prices as low as possible. b. keep all prices high so that people will save more money. c. allow the market to set low prices for abundant goods and high prices for scarce goods. d. never interfere with firms' price setting powers.
When unions and management fail to reach agreement and the public interest is compromised, the government may require the union and management to undertake mediation.
Answer the following statement true (T) or false (F)
In the case of the production of electronic calculators, introduced in the United States in the 1960s,
a. a technological breakthrough reduced the input quantities needed to produce them. b. quantity demanded increased significantly as prices fell. c. production costs fell with advances in technology. d. All of the above are correct.