If a country is currently lending more to the rest of the world than it is borrowing from the rest of the world, the country is a
A) net borrower.
B) debtor nation.
C) net lender.
D) creditor nation.
C
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The full-employment and full-adjustment level of real Gross Domestic Product (GDP) in the economy is represented by
A) the horizontal line at the price level. B) the LRAS curve. C) the distance between the LRAS curve and the AD curve. D) the AD curve.
The slope of a demand curve is almost always
a. positive, because when people buy more of a good the cost of producing it will rise. b. positive, because the more money a person has, the more of a particular good will be bought. c. negative, because when people buy more of a good the cost of producing it will fall. d. negative, because with everything else equal, the same people will buy more of a good when its price is lower. e. positive, because as the price rises, people want to sell more of the good.
In which of the following cases is it most likely that an increase in the size of a tax will decrease tax revenue?
a. The price elasticity of demand is small, and the price elasticity of supply is large. b. The price elasticity of demand is large, and the price elasticity of supply is small. c. The price elasticity of demand and the price elasticity of supply are both small. d. The price elasticity of demand and the price elasticity of supply are both large.
In early 2000s, oil prices were rising because of concern about the Iraqi invasion Kuwait and other situations, along with rapid growth in demand in the Far East. Prices eventually reached over $100 a barrel. How would most economists predict these high prices should affect the U.S. economy in terms of the AD/AS model?
A. Because oil is an important input in many production processes, the higher prices should shift the short-run aggregate supply curve down (to the right). B. Because oil is an important input in many production processes, the higher prices should shift the short-run aggregate supply curve up (to the left). C. They do not change anything, but are evidence of a shift in the aggregated demand curve to the right. D. They would have no effect because oil prices are a microeconomic phenomenon.