An increase in the money supply
a. lowers the interest rate, causing a decrease in investment and an increase in GDP.
b. lowers the interest rate, causing an increase in investment and a decrease in GDP.
c. lowers the interest rate, causing an increase in investment and an increase in GDP
d. raises the interest rate, causing an increase in investment and an increase in GDP.
e. raises the interest rate, causing a decrease in investment and a decrease in GDP.
Answer: c. lowers the interest rate, causing an increase in investment and an increase in GDP
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Is increased capital spending the only way for an economy to expand its production possibilities frontier?
A. No, an economy can also expand by invention and innovation. B. No, an economy can also grow by investment instead of capital spending. C. Yes, more capital is the only way to expand its production possibilities frontier. D. Yes, although more capital clearly has a high opportunity cost. E. Yes, because capital is the only constraining resource that limits growth.
Cross-sectional data observed at several points in time is known as:
A) time series data. B) panel data. C) experimental data. D) none of the above.
A budget surplus exists when
A. tax receipts < government expenditures + transfers. B. tax receipts > government expenditures + transfers. C. government expenditures ? transfers > tax receipts. D. government expenditures > transfers + tax receipts.
If no barriers blocking entry of resources to a market exist, then __________ is said to exist.
Fill in the blank(s) with the appropriate word(s).