Suppose that the government of Smallville spends? $2 trillion in 2018 and receives tax revenues of? $1.5 trillion in that same year. Which of the following is? TRUE?
a. Summerfield has a trade deficit of $0.5 trillion.
b. Summerfield has a budget deficit of $0.5 trillion.
c. Summerfield has a budget surplus of $0.5 trillion.
d. Summerfield has a trade surplus of $0.5 trillion.
Ans: b. Summerfield has a budget deficit of $0.5 trillion.
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According to the quantity theory of money, which one of the following economic variables would change in response to an increase in the money supply?
a. prices b. real income c. velocity d. employment
If a firm in a perfectly competitive market faces a market price of $7, and it decides to increase its production from 4,000 to 12,000 units, the firm's marginal revenue will:
A. stay the same. B. rise once diminishing marginal product sets in. C. increase from $28,000 to $84,000. D. diminish once diminishing marginal product sets in.
Refer to the above diagram. Assume that G and T1 are the relevant curves and that the economy is currently at B, which is its full-employment GDP. This economy has a:
A. cyclically adjusted budget surplus and an actual budget surplus. B. cyclically adjusted budget surplus only. C. cyclically adjusted budget deficit only. D. cyclically adjusted deficit and an actual budget deficit.
If the interest rate is 3 percent, to get back $500 in two years you would need to deposit ________ today.
A. $242.72. B. $471.30. C. $485.44. D. $494.00.