Government spending is an injection in the sense that it
A. increases the amount of total spending.
B. increases the size of the federal deficit.
C. decreases the amount of household saving.
D. decreases the amount of taxes paid.
Answer: A
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In the above figure, the equilibrium level of real GDP per year is
A) $1.0 trillion. B) $3.0 trillion. C) $2.0 trillion. D) $4.0 trillion.
Your textbook plots the estimated regression function produced by the probit regression of deny on P/I ratio The estimated probit regression function has a stretched "S" shape given that the coefficient on the P/I ratio is positive. Consider a probit regression function with a negative coefficient. The shape would
A) resemble an inverted "S" shape (for low values of X, the predicted probability of Y would approach 1) B) not exist since probabilities cannot be negative C) remain the "S" shape as with a positive slope coefficient D) would have to be estimated with a logit function
The business cycle consists of four phases. At the top we have:
a. expansion, followed by peak, and then recession followed by a recession. b. expansion, followed by a recession, and then peak followed by recession. c. peak, then an upturn followed by a recession, and then recession. d. peak, then a recession followed by expansion, and then recession. e. peak, then a recession followed by recession, and finally, expansion.
Explain how usury laws distort the market for funds. What is the most likely result if a usury law is passed and enforced?