Refer to the above figure. From the standpoint of society, the optimal output is
A) Q1
B) Q2
C) Q3
D) Q4
D
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Refer to Figure 10-6. The market is in equilibrium. If the government budget deficit rises, which of the following would you expect to see?
A) The budget deficit will have no impact on the quantity of loanable funds demanded by firms. B) The quantity of loanable funds demanded by firms will rise above $120 million. C) The interest rate will fall below 4 percent. D) The quantity of loanable funds demanded by firms will fall below $120 million.
In 2010, a British Petroleum oil rig exploded in the Gulf of Mexico. The explosion resulted in a major oil spill and a decrease in the supply of oil. At the same time, the average price of gasoline decreased
Which of the following best explains the decrease in the price of gasoline? A) The quantity demanded of gasoline increased. B) The demand for gasoline decreased, and the effect of the decrease in demand on the gasoline price was greater than the price effect of the decrease in supply. C) The demand for gasoline increased, and the effect of the increase in demand on the gasoline price was less than the price effect of the decrease in supply. D) The demand for gasoline remained unchanged.
Assume that foreign capital flows from a nation increase due to political uncertainly and increased risk. If the nation has highly mobile international capital markets and a fixed exchange rate system, what happens to the quantity of real loanable funds and monetary base in the context of the Three-Sector-Model? a. The quantity of real loanable funds rises and monetary base rises
b. The quantity of real loanable funds rises and monetary base falls. c. The quantity of real loanable funds falls and monetary base falls. d. The quantity of real loanable funds and monetary base remain the same. e. There is not enough information to determine what happens to these two macroeconomic variables.
According to the life cycle model discussed in the textbook, people tend to borrow while young, pay off debt and build wealth in their middle age, and live off savings during their retirement.
Answer the following statement true (T) or false (F)