Figure 11-1
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In Figure 11-1, to achieve equilibrium at potential GDP, the government could
A. increase taxes.
B. decrease transfer payments.
C. increase government purchases.
D. None of the above is correct.
Answer: C
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Under what condition can the U.S. government continue to pay interest on a rising debt without eventually needing to increase the average tax rate?
a. If the national debt grows at the same rate as nominal GDP b. If the nominal interest on the national debt grows faster than nominal GDP c. If the total interest payments on the national debt grow faster than nominal GDP d. If the national debt grows faster than nominal GDP e. If the real interest on the national debt grows faster than real GDP
The Bureau of Labor Statistics' "employed" category includes those who worked as paid employees, worked in their own business, or worked as unpaid workers in a family member's business
a. True b. False Indicate whether the statement is true or false
The downward slope of the aggregate demand curve shows that
A. an increase in aggregate demand reduces the long-run aggregate supply. B. a higher price level will cause planned purchase rates for final goods and services to be higher. C. a lower price level will cause planned purchase rates for final goods and services to be higher. D. an increase in aggregate demand increases the long-run aggregate supply.
The diagram suggests that:
A. when marginal product is zero, total product is at a minimum.
B. when marginal product lies above average product, average product is rising.
C. when marginal product lies below average product, average product is rising.
D. when total product is at a maximum, so are marginal product and average product.