When the housing bubble popped, the effect of the negative demand side shock and the negative supply side shock were the same on:
A. output, causing it to definitely decrease.
B. prices, causing them to definitely rise.
C. output, causing it to definitely increase.
D. prices, causing them to definitely fall.
Answer: A
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According to this Application, studies estimated that a decrease of consumer wealth of $1 would ________ consumption spending by somewhere between ________
A) lower; $0.21 and $0.72 B) raise; $0.10 and $0.50 C) raise; $0.21 and $0.72 D) lower; $0.02 and $0.07
Cartels tend not to be long-lived because of ?the Prisoner's Dilemma.
Answer the following statement true (T) or false (F)
The above figure shows the payoff matrix facing an incumbent firm and a potential entrant. What policy could government adopt to prevent entry deterrence by the incumbent?
A) production quotas B) price ceiling C) safety standards D) None of the above is correct.
Which of the following statements is most accurate about fiscal policy since the end of the Great Recession?
A. Cyclically adjusted deficits that occurred in 2009 eventually gave way to cyclically adjusted surpluses as the economy recovered. B. The cyclically adjusted budget remained in deficit, but those deficits became smaller from 2009 to 2015, so fiscal policy became contractionary. C. The cyclically adjusted budget remained in deficit and those deficits became smaller from 2009 to 2015, but fiscal policy remained expansionary. D. Cyclically adjusted deficits rose steadily from 2009 to 2015, so fiscal policy became increasingly expansionary.