Assume that the actual deficit is $150 billion with the economy well below potential output and that the level of economic activity rose to its potential level while tax revenues increased by $50 billion and transfer payments fell by $20 billion
Then, what is the structural deficit? a. $180 billion
b. $120 billion
c. $220 billion
d. $80 billion
e. $100 billion
D
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In monopolistic competition, advertising costs
A) are fixed costs. B) are variable costs. C) affect the firm's ATC curve. D) All of the above answers are correct.
In the IS model, assuming that the real interest rate does not change, an increase in autonomous ________ leads to an increase in the equilibrium level of ________
A) investment; consumption B) consumption; investment C) net exports; investment D) all of the above E) none of the above
One of the factors contributing to the fact that labor productivity is higher in the U.S. than in the People's Republic of China is
A) China's larger stock of capital. B) the higher capital/labor ratio in China. C) the higher capital/labor ratio in the U.S. D) China's smaller stock of fossil fuels. E) the fact that much labor in the U.S. is in management.
The graph below indicates that the economy can produce both:
A. 10 units of eggs and 20 units of rye, and this would be efficient. B. 20 units of eggs and 5 units of rye, although this would not be efficient. C. 10 units of eggs and 20 units of rye, although this would not be efficient. D. 20 units of eggs and 5 units of rye, and this would be efficient.