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In Exhibit 3-11, in Panel B the movement from point A to point C describes a(n):
A. increase in both demand and supply, where the increase in supply is relatively bigger.
B. decrease in both demand and supply, where the decrease in supply is relatively bigger.
C. increase in demand and a decrease in supply, where the decrease in supply is relatively bigger.
D. decrease in demand and increase in supply, where the increase in supply is relatively bigger.
Answer: D
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If you wanted to understand how an economy grew without looking at the impact of inflation, you should use ________ to compare different times within the economy
A) real GDP B) nominal GDP C) the CPI D) the GDP deflator
The Federal Reserve econometric model estimates that a 1 percent increase in government spending, with the money supply held constant, will
A) increase real GDP by 1 percent per year for two years. B) increase real GDP by 2 percent per year for two years. C) decrease real GDP by 1 percent per year for two years. D) have no effect on real GDP.
Imperfect information can be an entry barrier
Indicate whether the statement is true or false
If a person produces capital goods, she sacrifices current production of consumer goods in order to obtain the capability of producing more goods and services in the future. This is called roundabout production
a. True b. False