In the figure above, the DLF curve is the demand for loanable funds curve and the PDLF curve is the private demand for loanable funds curve. If there is no Ricardo-Barro effect, the figure shows a situation in which the government has a budget
A) deficit of $1 trillion.
B) deficit of $1.5 trillion.
C) surplus of $0.5 trillion.
D) deficit of $0.5 trillion.
E) surplus of $1 trillion.
A
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Which of the following is true?
i. A rational choice is always made in the pursuit of social interest. ii. Economics is a social science. iii. Economists try to understand how the economic world works by testing positive statements. A) only i B) ii and iii C) only ii D) i and ii E) only iii
Given the table above, suppose consumption in period two is $35,000. Then, the interest rate rises to five percent, and period-two consumption falls to $34,900. We may infer that ________
A) the income effect is stronger than the substitution effect B) the substitution effect is stronger than the income effect C) the substitution and income effects cancel out D) this consumer has a binding borrowing constraint
A product with qualities that consumers lack the expertise to assess without assistance is called a(n)
A) search good. B) experience good. C) credence good. D) inferior good.
The economic problem can best be stated as:
A. Given the fact that the economy is inefficient, how much and what type of government intervention should be used to improve the efficiency of the economy? B. Given scarce resources, how exactly do societies go about deciding what to produce, how to produce it, and for whom to produce? C. What is the best rate of economic growth for a society? D. How can the economy improve technology so as to shift the production possibility frontier up and to the right?