Spending on newly constructed homes is part of the investment component of GDP
a. True
b. False
Indicate whether the statement is true or false
True
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If a corporation begins to suffer large losses, then the default risk on the corporate bond will
A) increase and the bond's return will become more uncertain, meaning the expected return on the corporate bond will fall. B) increase and the bond's return will become less uncertain, meaning the expected return on the corporate bond will fall. C) decrease and the bond's return will become less uncertain, meaning the expected return on the corporate bond will fall. D) decrease and the bond's return will become less uncertain, meaning the expected return on the corporate bond will rise.
Economists generally consider the use of taxes as the most efficient way of solving pollution problems
a. True b. False Indicate whether the statement is true or false
If the federal government wishes to move the economy out of a recessionary gap, the appropriate fiscal policy is a(n)
A. increase in taxes. B. decrease in government purchases. C. decrease in transfer payments. D. None of the above is correct.
If a legal price ceiling is set above the equilibrium price:
A. a shortage of the product will occur. B. neither the equilibrium price nor the equilibrium quantity will be affected. C. a surplus of the product will occur. D. a black market will evolve.