When markets reach the ____ price all the opportunities for mutually beneficial trade have taken place and the sum of consumer and producer surplus is ____
a. minimum, maximized
b. maximum, minimized
c. equilibrium, maximized
d. equilibrium, shared equally between consumers and producers
c
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A Keynesian economist believes that
A) if the economy was left alone, it would rarely operate at full employment. B) the economy is self-regulating and always at full employment. C) the economy is self-regulating and will normally, though not always, operate at full employment if monetary policy is not erratic. D) the economy is self-regulating and will normally, though not always, operate at full employment if fiscal policy is not erratic.
Why don't consumers work in the two-period model?
A) It's a convenient simplification. B) It would make no difference to the model if consumers could work. C) People who participate in real-world credit markets do not work. D) We don't know how to include workers in the model.
The emergence of the subprime mortgage market following the recession of 2001 set off a boom in the housing industry
a. True b. False Indicate whether the statement is true or false
If there is currently a recessionary gap: a. The price level will tend to rise. b. Real output will tend to fall
c. Both a. and b. will occur. d. None of the above will occur.