The real balance effect (wealth effect), the interest rate effect, and the net exports effect all help to explain the:
a. decrease in supply in the loanable funds market.
b. large federal budget deficit.
c. increase in short-run aggregate supply.
d. downward-sloping aggregate demand curve.
d
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When the price system fails to generate an efficient allocation of resources
A) the market will always correct it. B) consumers will spend less. C) business will produce more. D) too few or too many goods will be produced.
Cost-reduction generates
a. Increases in long-run profitability b. Increases in long-run profitability only if the cost reduction is difficult to imitate c. Decreases in long run profitability d. No change in profitability
The budget of an economy is said to be in deficit when: a. federal outlays exceed revenues
b. federal revenues exceed outlays. c. anticipated inflation rate exceeds its actual rate. d. there is a loss of value of a country's currency with respect to one or more foreign reference currencies. e. anticipated interest rate exceeds its actual rate.
Suppose that the alternative uses of an hour of your time in the evening, ranked from best to worst, are (1) study economics, (2i) watch two half-hour TV sitcoms, (3) play pool, and (4) jog around town. You can only choose one activity. What is the opportunity cost of studying economics for one hour, given this information? a. Jogging around town
b. Watching two half-hour TV sitcoms. c. Playing pool. d. The sum of watching two half-hour TV sitcoms, playing pool, and doing your laundry.