The Keynesian model differs from the classical model in that
a. people do not have perfect information about the future in the Keynesian model.
b. real wages are not flexible in the Keynesian model.
c. monetary policy affects aggregate demand in the Keynesian model.
d. expectations are crucial in the classical model.
e. all of the above.
A
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In the one-input model, a decrease in output price will always cause labor demand to shift in.
Answer the following statement true (T) or false (F)
The percentage change in the quantity supplied in response to a percentage change in the price is known as the
A) slope of the supply curve. B) excess supply. C) price elasticity of supply. D) All of the above.
Calculate GDP for an economy with exports of $5 trillion, investment of $1.5 trillion, consumption spending of $11 trillion, imports of $6 trillion, and government purchases of $3 trillion
When the government runs a budget surplus, it uses the funds to:
A. pay down outstanding debt. B. decrease public saving. C. decrease transfer payments. D. issue bonds.