In the long run, output gaps are eliminated by:
A. increasing potential output.
B. increased efficiency in labor markets.
C. price changes.
D. reducing potential output.
Answer: C
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Keynes stated that the amount of savings is based on ________________________ and the demand for investment funds is based on the _________________.
Fill in the blank(s) with the appropriate word(s).
Refer to the figure below. 
The dominant strategy for Row Resorts is to ________, and the dominant strategy for Column Cruises is to ________.
A. offer reduced rates; offer reduced rates B. offer reduced rates; keep rates high C. keep rates high; offer reduced rates D. keep rates high; keep rates high
In a market-based economy, what is the role of a system of prices?
A. To create abundance and surpluses B. To make goods and services too expensive. C. To address the problem of scarcity D. To create shortages
When one nation specializes in the production of one good and another nation specializes in the production of another good, more of both goods can be produced
Indicate whether the statement is true or false