A major macroeconomic leakage from the circular flow is:
a. Consumption
b. Savings
c. Saving
d. All of the above.
e. None of the above.
.C
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Which good would you expect to have a greater price elasticity: a gallon of gasoline sold at a specific gasoline station on Main Street in Phoenix, a gallon of gasoline sold in Phoenix, or a gallon of gasoline sold in Arizona? Why?
What will be an ideal response?
Consider a hypothetical economy, whose GDP was $10,000 . consumption equaled $9,800, investment equaled $125, goods exported equaled $255, and goods imported equaled $500, in 2010 . Calculate the government spending in this economy during the year
a. $120 b. $380 c. $245 d. $200 e. $320
According to the maximin criterion, income should be transferred from the rich to the poor as long as it
a. raises the well-being of the least fortunate. b. does not alter incentives to work and save. c. promotes an equal distribution of income. d. does not lower the welfare of the elderly.
The classical economists felt that saving would be equal to investment because
A) wages are flexible. B) prices of domestic goods are flexible. C) interest rates are flexible. D) prices of imports are flexible.