Refer to the diagram, where T is tax revenues and G is government expenditures. All figures are in billions of dollars. If the full-employment GDP is $400 billion while the actual GDP is $200 billion, the cyclically adjusted budget deficit is:
A. $40 billion.
B. zero.
C. $60 billion.
D. $20 billion.
D. $20 billion.
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One effect of market intervention is resource misallocation.
Answer the following statement true (T) or false (F)
According to the Rybczynski theorem, at constant world prices, if a country experiences a gain in its capital stock it will produce
A) more of the capital intensive good and less of the labor intensive good. B) more of both goods. C) less of the capital intensive good and more of the labor intensive good. D) less of both goods.
A closed economy lacks ______.
a. a stock market b. saving and investment c. a GDP d. international trade
The local baseball stadium's concession stands previously sold hot dogs for 80 cents apiece. At that price, when a baseball fan went to watch a baseball game, he bought 2 hotdogs. But now that the stadium has a "dime-a-dog night," he has purchased 6 hot dogs. What is the approximate value of this individual's absolute price elasticity of demand for hot dogs?
A. 0.80 B. 1.00 C. 0.64 D. 1.56