Suppose the economy's short-run equilibrium level is at a point to the left of Natural Real GDP. Which of the following statements is true?
A) The economy is in an inflationary gap.
B) The economy is in a recessionary gap.
C) The economy is in long-run equilibrium.
D) This situation is actually impossible.
B
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With the proposed TPP tariff changes on imported shoes, New Balance would be ________ by the change in prices on some of the imported shoes sold by other companies that compete with
New Balance's U.S.-produced shoes, and New Balance would be ________ because of the price it could now charge for the shoes it imports from TPP countries. A) hurt; hurt B) helped; helped C) hurt; helped D) helped; hurt
The Ricardian Equivalence holds only if
A) the government is altruistic. B) there are no binding credit constraints. C) the government runs deficits. D) the government runs surpluses.
A(n) _____ arises when people purchasing a public good have an incentive to let others pay for it and then take advantage of those purchases made by others
a. free rider problem b. monopsony c. monopoly d. adverse selection
A positive externality
a. is a benefit to the producer of the good. b. is a benefit to the consumer of the good. c. is a benefit to someone other than the producer and consumer of the good. d. results in an optimal level of output.