An expansionary gap in the short-run results in:
a. lower resource prices in the long run.
b. unemployment in the long run
c. a recessionary gap in the long run.
d. cost-push inflation in the long run.
e. demand-pull inflation in the long run.
d
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Real GDP per capita
A. necessarily grows more rapidly than real GDP. B. cannot grow more slowly than real GDP. C. cannot grow more rapidly than real GDP. D. can grow either more slowly or more rapidly than real GDP.
Which of the following explains the vicious circle of poverty? a. By investing in education and infrastructure at the same time, the country can overcome the problems of poverty
b. Poverty arises out of the lack of investment, but they cannot invest because they are poor. c. A nation can shift its production possibility curve inward by shifting more resources into the production of capital goods. d. A nation can shift its production possibility curve outward by shifting more resources into the production of consumer goods. e. There are dual economies in the world: Some are rich and others are poor.
When the Sykes Corporation (an American company) buys shares of Audi stock (a German company) for its pension fund, U.S. net capital outflow
a. increases because an American company makes a portfolio investment in Germany. b. declines because an American company makes a portfolio investment in Germany. c. increases because an American company makes a direct investment in Germany. d. declines because an American company makes a direct investment in Germany.
Automatic stabilizers dampen economic fluctuations during recessions because ________ decrease while ________ increase
A) tax revenues; tax payments B) tax payments; transfer payments C) tax payments; tax revenues D) unemployment rates; inflation rates