An increase in government spending will result in an increase in the price level and an increase in real GDP in the long run
Indicate whether the statement is true or false
FALSE
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Opportunity cost is the value of the next best alternative that is given up.
Answer the following statement true (T) or false (F)
Which of the following would be studied in macroeconomics?
a. a drop in the price of personal computers b. an individual household's decision on how to allocate its spending power c. a rise in employment in movie theaters across the nation d. total output in the nation e. a local bank's increase in the interest rate offered on savings deposits
Mutually beneficial international trade between two countries depends on
a. each country having an absolute advantage in the production of a different good b. one country being worse (requiring more resources) than the other in the production of every good c. at least one country having a zero opportunity cost in the production of at least one good d. one country being relatively better at producing a good (which makes the other country relatively worse at it) e. one country being relatively better at producing all goods
The economy pictured in the figure below has a(n) ________ gap with a short-run equilibrium combination of inflation and output indicated by point ________. 
A. recessionary; B B. recessionary; C C. recessionary; A D. expansionary; A