In an open mixed economy, the inflationary expenditure gap may be described as the:
A. Excess of GDP over C a + I g + X n + G at the full-employment output
B. Excess of S a + M + T over I g + X + G at the full-employment GDP
C. Extra consumption that occurs when investment increases in a full-employment economy
D. Excess of C a + I g + X n + G at the full-employment GDP
D. Excess of C a + I g + X n + G at the full-employment GDP
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The fact that output gaps will not last indefinitely, but will be closed by rising or falling inflation is the economy's:
A. income-expenditure multiplier. B. self-correcting property. C. short-run equilibrium property. D. long-run equilibrium property.
All else held constant, the international value of foreign currencies will increase against the U.S. dollar if ________.
A. U.S. citizens reduce spending on imports B. there are withdrawals of funds by foreigners from U.S. money markets C. there is an increase in the number of foreign tourists in the United States D. the U.S. Federal Reserve raises real interest rates
The relative poverty line defines poverty:
A. in relation to the income of the rest of the population. B. based on the expenditure on food relative to total income. C. as the price of basic food, clothing, shelter and utilities, and adjusts for geographic differences in the cost of living. D. None of these is true.
In the circular-flow diagram, households and firms are the decision makers
a. True b. False Indicate whether the statement is true or false