Which of the following best describes the relationship between investment and economic growth?
a. Any investment will have a positive impact on economic growth.
b. Economic growth depends on the type and quality of investment.
c. Countries with significant levels of foreign investment have higher levels of economic growth.
d. Investment in human capital is the primary means of boosting for economic growth.
b. Economic growth depends on the type and quality of investment.
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For each of the following policy options the government can undertake to make the debt sustainable, explain the economic consequences and the resulting change to potential GDP: a. increasing seigniorage b. increasing taxes on wages c
increasing taxes on capital income d. decreasing expenditure on government capital goods e. decreasing expenditure on transfer programs such as Social Security, Medicare, and Medicaid
Many economists who accept the real business cycle explanations of economic fluctuations
a. believe that the sharp rise in the relative price of imported oil was the central cause of the deep recession in the United States in the mid-1970s. b. believe that the restrictive Federal Reserve monetary policy was the central cause of the deep recession in the United States in the mid-1970s. c. believe that the sharp rise in the relative price of imported oil was not the main cause of the deep recession in other industrialized nations in the mid-1970s. d. both a and c. d. None of the above
Which of the following causes a leftward shift in the short-run aggregate supply curve? a. An increase of goods prices while nominal incomes are unchanged
b. An increase in nominal incomes (wages and salaries). c. An increase of full-employment real GDP. d. An increase of personal consumption expenditures while the price level is unchanged. e. An increase of personal consumption expenditures while full-employment real GDP is unchanged.
To test the gravity equation of trade, a regression model was calculated for two nations, the United States and Canada, testing the correlation among:
a. regional trade, size of GDP, and distance for states and provinces. b. intra-industry trade, size of GDP, and size of states and provinces. c. bilateral trade and ratio of GDP for states and provinces. d. bilateral trade, size of GDP, and distance for states and provinces.