The most severe depression in the United States was the 30 percent decrease in real GDP that occurred between
a. 1899 and 1913.
b. 1929 and 1933.
c. 1959 and 1963.
d. 1979 and 1983.
b
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A good which has social costs that exceed private costs has a price
A) equal to marginal social cost. B) that is too low. C) that is too high. D) that is inefficient because price exceeds marginal social cost.
If a country produces a commodity in the range of decreasing returns to scale, and the country begins to export more in a pure free trade system, the domestic price of the commodity will
a. fall. b. rise. c. exceed the price in foreign countries. d. be below the price in foreign countries. e. One cannot predict the impact on the price of the commodity.
The balanced budget multiplier says that
A. An increase in government spending paid for by a tax increase of equal size has no effect on aggregate demand. B. An increase in government spending must be paid for by a tax cut of equal size. C. An increase in government spending paid for by a tax increase of equal size shifts aggregate demand leftward. D. An increase in government spending paid for by a tax increase of equal size shifts aggregate demand rightward.
An increase in the labor force participation rate
A) means there are more discouraged workers. B) implies that the unemployment rate must fall. C) implies that the unemployment rate must rise. D) is consistent with either a rise or a fall in the unemployment rate.