Keynesian economists tend to believe that the private sector of the economy (households and businesses) is inherently
A. very stable in its consumption and investment decisions.
B. unstable in its consumption and investment decisions.
C. smaller than the foreign trade sector of the economy.
B. unstable in its consumption and investment decisions.
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Refer to the figure below. The equilibrium price is ________, and the equilibrium quantity is ________. 
A. $30; 15 B. $35; 20 C. $25; 5 D. $25; 20
When aggregate economic activity is declining, the economy is said to be in
A) a contraction. B) an expansion. C) a trough. D) a turning point.
In the Tragedy of the Commons parable, if the medieval townspeople had foreseen the tragedy, then they could have dealt with the problem in much the same way that modern society deals with
a. fire protection. b. poverty. c. pollution. d. national defense.
If the nominal interest rate is 8 percent and the inflation rate is 3 percent, then the real interest rate equals:
A. 8 percent. B. 11 percent. C. 3 percent. D. 5 percent.