Which of the following accurately contrasts consumption and investment?
a. Investment is a much larger component of aggregate demand than consumption.
b. Consumption involves government purchases, whereas investment involves household purchases.
c. Consumption includes purchases by households, whereas investment includes purchases by firms.
d. Investment is more influenced by disposable income than is consumption.
c. Consumption includes purchases by households, whereas investment includes purchases by firms.
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According to the classical economists, actual real GDP
A) always equals actual aggregate income. B) sometimes equals actual aggregate income. C) never equals actual aggregate income. D) is not related to aggregate income.
Which of the following is an example of contractionary fiscal policy?
A. Cutting spending B. Reducing taxes C. Increasing spending D. None of these
Refer to Exhibit 6-2. The employment rate in year 2 is
a. 12 1/2 percent. b. 75 percent. c. 87 1/2 percent. d. 30 percent. e. 50 percent.
if a business is realizing economic losses in a competitive market, it is:
What will be an ideal response?