Some economists believe that deficit spending can impose a burden on future generations. Which of the following does NOT explain the burden?
A) Investment will be crowded out by an increase in current consumption.
B) Deficit spending that is allocated to purchases leads to long-term increases in real GDP.
C) Future generations will have a smaller capital stock that will reduce their wealth.
D) Future generations will have to be taxed at a higher rate.
B
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Which of the following is true?
i. A rational choice is always made in the pursuit of social interest. ii. Economics is a social science. iii. Economists try to understand how the economic world works by testing positive statements. A) only i B) ii and iii C) only ii D) i and ii E) only iii
What effect does a price hike have on the total revenue of the producers?
What will be an ideal response?
If the world real interest rate falls, then a country that is an international lender
A) increases the amount of its lending. B) does not change the amount of its lending. C) decreases the amount of its lending. D) None of the above answers is correct because lending might increase, decrease, or not change.
In the short run, which of the following is FALSE about the shutdown point?
A) Total revenue is equal to total fixed cost. B) Total revenue is equal to total variable cost. C) Product price is equal to the minimum average variable cost. D) Price multiplied by quantity must be equal to minimum average variable cost multiplied by quantity.