If you believe that government intervention to achieve full employment without inflation can be effective, you are a member in good standing in the
a. Phillips school
b. classical school
c. Keynesian school
d. neo-Keynesian school
e. rational expectations school
C
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Total taxes minus transfer payments minus government interest payments is called:
A. a budget surplus. B. a budget deficit. C. national saving. D. net taxes.
Which of the following statements is true of the cross-price elasticity of demand?
A) The cross-price elasticity of demand between substitutes is zero. B) The cross-price elasticity of demand between complements is zero. C) The cross-price elasticity of demand between substitutes is negative. D) The cross-price elasticity of demand between complements is negative.
What is potential GDP?
A) It is the level of real GDP in the short run. B) It is the difference between current GDP and maximum GDP. C) It is the level of GDP at which inflation is constant. D) It is the level of real GDP in the long run.
When market failures occur
A) the invisible hand will correct for the market failures. B) the price system will correct the market failures. C) people will reduce their consumption. D) the government can step in to correct the market failure.