The circular flow model shows how households and firms compete with each other
Indicate whether the statement is true or false
F
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A majority of federal revenue once came from tariffs
a. True b. False
If aggregate quantity supplied exceeds aggregate quantity demanded, we can expect an unplanned
a. depletion of inventories, causing firms to raise prices. b. depletion of inventories, causing firms to lower prices. c. accumulation of inventories, causing firms to raise prices. d. accumulation of inventories, causing firms to lower prices.
As the Medicare program is expanded to cover the cost of prescription drugs for the elderly, other things constant, this will lead to
a. an increase in demand and higher prices for prescription drugs. b. an increase in demand and lower prices for prescription drugs. c. reduction in demand and lower prices for prescription drugs. d. reduction in demand and higher prices for prescription drugs.
From 1995 to 2000 the stock market as measured by the S&P 500 index
A. bust a bubble. B. was flat. C. declined in real terms. D. had a record boom.