A recessionary gap:
a. is of little consequence in a capitalist economy.
b. represents actual physical output lost.
c. implies an equilibrium level of output less than the full-employment level.
d. is associated with rising labor prices.
e. will automatically close, according to the Keynesian model.
c
You might also like to view...
If Ap is total autonomous planned spending, c is the marginal propensity to consume, s is the marginal propensity to save, and Y is the equilibrium income level, then
A) Ap/Y. B) Y = Ap/s. C) sY. D) cAp.
Most of the total income earned in the U.S. economy is ultimately paid to
a. households in the form of wages and fringe benefits. b. landowners in the form of rent. c. landowners in the form of interest. d. landowners in the form of profit.
If the demand for a product is perfectly inelastic, a decrease in the price of the product
A) will increase total revenue. B) will decrease total revenue. C) will not change total revenue. D) any of the above are possible.
If a 10 percent increase in the price of one good results in no change in the quantity demanded of another good, then it can be concluded that the two goods are:
A. Complementary goods B. Substitute goods C. Independent goods D. Normal goods