Suppose the economy's multiplier is 2. Other things equal, a $25 billion decrease in government expenditures on national defense will cause equilibrium GDP to:
A. decrease by $50 billion.
B. decrease by $150 billion.
C. remain unchanged since spending on military goods is unproductive and usually wasteful.
D. decrease by $25 billion.
A. decrease by $50 billion.
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To be able to price discriminate, a firm must
A) lower prices for all customers. B) raise prices for all customers. C) be able to identify and separate different types of buyers. D) sell a product that can be resold. E) Both answers B and C are correct.
If the dollar appreciates, how will aggregate demand in the United States be affected?
A) Aggregate demand will shift to the right as exports increase. B) Aggregate demand will shift to the right as imports increase. C) Aggregate demand will shift to the left as exports increase. D) Aggregate demand will shift to the left as imports increase.
A situation in which one firm's actions with respect to price, quality, advertising and related changes may be strategically countered by the reactions of one or more other firms in the industry is known as
A) strategic dependence. B) economies of scale. C) the concentration ratio. D) barriers to entry.
What are the main objectives of most state insurance regulators?
a. Enforcing insurance mandates and monitoring insurance company profits b. Ensuring that all citizens have insurance and keeping insurance costs down c. Legislating moral hazard insurance policies and setting healthcare standards d. Monitoring adverse selection issues and setting insurance premium rates