All else constant, an increase in the amount of government spending on roads and bridges would cause GDP in the domestic economy to increase
Indicate whether the statement is true or false
TRUE
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A crucial national income accounting identity sets the government budget deficit equal to
A) S - I - NX. B) S + I - NX. C) S - I + NX. D) S + I + NX.
The fact that we are operating at a point inside a bowed out production possibilities frontier indicates there is
A. scarcity. B. increasing opportunity cost. C. unemployment. D. constant opportunity cost.
The primary method for controlling the money supply in the United States is to limit the
A. Amount of currency that is printed. B. Amount of money that is spent by changing income transfers. C. Amount of money that is spent by changing tax policy. D. Volume of loans the banking system can make.
Refer to the graph above for a private closed economy. At the $150-billion level of GDP:
A. Aggregate expenditures are less than real GDP, so GDP will rise
B. Aggregate expenditures are more than real GDP, so GDP will fall
C. Aggregate expenditures are more than real GDP, so GDP will rise
D. Aggregate expenditures will be equal to GDP, so there will be no change in GDP