When government spending exceeds government revenues during a given period of time
A) the national debt must be decreasing. B) a budget surplus exists.
C) Congress is obliged to raise taxes. D) a budget deficit exists.
D
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A statement that "All children should receive free health care" is an example of what kind of statement?
A) a fair statement B) a natural experiment statement C) a normative statement D) a positive statement E) a statement on the margin
Which of the following statements about the underground economy is true?
A) Most transactions that occur in the underground economy are included in the calculation of GDP. B) Excluding underground economy production from measured GDP causes errors in GDP growth estimates in the long run. C) Income that is earned but not reported as income for tax purposes is included in the calculation of GDP. D) The underground economy in developing countries amounts to less than 10% of measured GDP.
Firms that face downward-sloping demand curves for their output are called
a. perfectly competitive b. price takers c. price searchers d. resource price takers e. resource price searchers
Mathematically, the value of the spending multiplier in terms of the marginal propensity to consume (MPC) is given by the formula:
a. MPC ? 1. b. (MPC ?1) / MPC. c. 1 / MPC. d. 1 / (1 ? MPC).