For an imaginary closed economy, T = $5,000; S = $11,000; C = $48,000; and the government is running a budget surplus of $1,000 . Then
a. private saving = $10,000 and GDP = $55,000.
b. private saving = $10,000 and GDP = $63,000.
c. private saving = $12,000 and GDP = $67,000.
d. private saving = $12,000 and GDP = $69,000.
b
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In the long run, what determines the value of money?
A) real GDP B) money market equilibrium C) the government budget balance D) international trade E) equilibrium in the loanable funds market
If one nation is able to produce a good at a lower opportunity cost than another, it has
A) an absolute advantage in that good. B) a comparative advantage in that good. C) a productivity advantage in that good. D) a technological advantage in that good. E) no reason to want to trade that good.
Assume that as a firm decreases its price its total revenue decreases. Which of the following is a possible value of its price elasticity of demand?
A. 0.4 B. 1 C. 1.4 D. 4
According to the misperceptions theory, an anticipated 10% decrease in the money supply leads to a short-run reduction in the price level of
A. some amount between 0% and 10%. B. 5%. C. 10%. D. 0%.