Suppose the following information describes the economy:Consumption3000Government Budget surplus500Government transfers and interest payments750Government tax collections1,750GDP6,000Private saving equals ____and national saving equals ________.
A. 3,000; 3,500
B. 1,500; 2,500
C. 2,000; 2,500
D. 1,250; 1,750
Answer: C
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If a lobster in Maine costs $10 and that the same type of lobster in Massachusetts costs $30, then people could make a profit by
a. buying lobsters in Maine and selling them in Massachusetts. This action would increase the price of lobster in Massachusetts. b. buying lobsters in Maine and selling them in Massachusetts. This action would decrease the price of lobster in Massachusetts. c. buying lobsters in Massachusetts and selling them in Maine. This action would increase the price of lobster in Massachusetts. d. buying lobsters in Massachusetts and selling them in Maine. This action would decrease the price of lobster in Massachusetts.
In the early 1960s, the Kennedy administration made considerable use of
a. fiscal policy to stimulate the economy. b. fiscal policy to slow down the economy. c. monetary policy to stimulate the economy. d. monetary policy to slow down the economy.
Which of the following rise during a recession?
a) losses but not unemployment b) unemployment but not losses c) neither losses nor unemployment d) both losses and unemployment
For this question, assume that the economy is initially operating at the natural level of output. A monetary expansion will cause
A) no change in the real wage in the medium run. B) an increase in investment in the medium run. C) a reduction in the interest rate in the medium run. D) no change in the nominal wage in the medium run.