Which of the following combinations of points are both efficient and attainable for this economy?

When total planned expenditures are more than real GDP, there will be inventory accumulation

a. True b. False Indicate whether the statement is true or false

Suppose a worker in Argentina can produce either 20 units of cloth or 2 bottles of wine per day, while a worker in Chile can produce either 24 units of cloth or 12 bottles of wine per day. If Argentina transfers 2 units of labor from wine to cloth and Chile transfers 1 unit of labor from cloth to wine, the combined output will be:

a. 16 bottles of wine and 8 units of cloth. b. 16 bottles of wine and 16 units of cloth. c. 12 bottles of wine and 12 units of cloth. d. 8 bottles of wine and 16 units of cloth.

Referring to a production possibilities curve and the goods being compared, depict the economic event. Suppose the United States was at full employment in 2003 just before invading Iraq. Although the war was won quickly, winning the peace took a decade (guns vs. butter).

A. A movement from a point on or near the curve to a point inside the curve B. A shift in the entire curve to the right (outward) C. A shift in the entire curve to the left (inward) D. A movement along the curve

Based on the figure below. Starting from long-run equilibrium at point C, a decrease in government spending that decreases aggregate demand from AD1 to AD will lead to a short-run equilibrium at__ creating _____gap.

A. B; no output B. D; an expansionary C. B; recessionary D. D; a recessionary