In the United States during the 1930s
A) government spending decreased and taxes increased, resulting in a fiscal contraction.
B) government spending and taxes both decreased, resulting in a net fiscal contraction.
C) government spending increased and taxes decreased, resulting in a fiscal expansion.
D) government spending and taxes both increased, resulting in zero net fiscal expansion.
D
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The aggregate production function is the
a. relationship between the amount of labor employed in the economy and the total amount of output produced b. relationship between available labor and the total amount of output produced c. the relationship between land and capital and labor employed in the economy d. long-run equilibrium of the macroeconomy e. amount of output any worker can produce given existing land and capital constraints
The expression, "There's no such thing as a free lunch," implies that
What will be an ideal response?
represents the spending of consumers, government, businesses, and foreign trade partners
What will be an ideal response?
Mauritius, an island off the coast of Africa, competes with other countries producing goods with low-skilled labor. In 2006, it was reported that its "...factories have been exposed to ... competition from China, India, and other Asian mass producers." As a result, "the main export industry has seen a 30% reduction in volume..." Suppose real GDP is $14 billion, exports total $2 billion and the multiplier is 4. If exports decline by $600,000,000, real GDP in Mauritius will:
a) increase by $2.4 billion b) decrease by $2.4 billion c) decrease by $8 billion d) increase by $4 billion