A reflationary policy could include:
a) decreasing injections
b) increasing taxation rates
c) increasing interest rates
d) increasing government spending
Answer: d) increasing government spending
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In a certain economy, the components of aggregate spending are given by:C = 100 + 0.9(Y - T) - 500rI = 150 - 1,000rG = 200NX = 50T = 100Given the information about the economy above, what is the short-run equilibrium output if the real interest rate is 6 percent?
A. 320 B. 3,200 C. 3,500 D. 450
The supply of product X is elastic if
A. an 8% increase in price generates an 8% increase in quantity supplied. B. a 10% decrease in price does not affect quantity supplied. C. a 5% increase in price generates a 7% increase in quantity supplied. D. a 7% decrease in price generates a 5% decrease in quantity supplied.
What is the main reason behind the disparity in the growth rates of South Korea and North Korea over the last sixty years?
What will be an ideal response?
Explain why, in a simple economy which does not include the government or taxation, saving equals investment at the equilibrium level of output
What will be an ideal response?