An increase in investment causes the price level to ________ in the short run and ________ in the long run
A) decrease; increase B) increase; increase further
C) increase; decrease D) decrease; decrease further
B
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The structural surplus
A) is legally required to be positive. B) fluctuates over the business cycle. C) is, by definition, equal to the negative of the cyclical deficit. D) equals the actual surplus plus the cyclical surplus. E) is the government budget surplus that would exist if the economy was at full employment.
A drop in six-month LIBOR is good news to __________ in a swap contract
A) the fixed-rate payer B) the floating-rate payer C) both payers D) neither payer
Which game does the Cournot model most resemble and why?
a. the Battle of the Sexes because firms need to coordinate their outputs. b. the Battle of the Sexes because firms disagree on which outcome is best. c. the Prisoners Dilemma because firms don't maximize joint payoffs in equilibrium. d. the Prisoners Dilemma because firms play dominant strategies.
Refer to the graph shown. In equilibrium, total surplus is equal to:
A. 1,200. B. 1,400. C. 600. D. 2,000.