Which one of the following could cause a recessionary gap?
A. Interest rates are too low.
B. Consumers spend more than they earn.
C. Price levels are too high.
D. Businesses spend more than they save.
Answer: C
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Comment on how extractive institutions affect:
a) the return-to-entrepreneurship schedule. b) the opportunity cost of entrepreneurship schedule. What will be an ideal response?
Crowding out occurs
a. when an increase in government spending crowds out tax revenues. b. when an increase in government spending increases investment spending. c. when an increase in government spending crowds out bonds. d. when an increase in government spending crowds out other types of spending. e. when an increase in government spending crowds out the money supply.
The rate at which one input can be exchanged for another without altering output is called
A. the marginal rate of technical substitution. B. the slope of the total product curve. C. the law of diminishing returns of labor. D. the slope of the marginal product of labor.
What is the main selection issue researchers must address when trying to estimate the effectiveness of government training programs?
A. Government training programs are usually geared toward developing general skills rather than providing specific job training. B. Evaluation schemes tend to lose track of participants once they start a new job after the training. C. Most government training programs are only offered to the unemployed and not to workers who would like to switch jobs. D. The true cost of government training programs is unknown because unemployed workers also receive welfare benefits. E. The most motivated unemployed workers are the ones who are also most likely to take advantage of government training programs.