Starting from long-run equilibrium, a decrease in autonomous investment results in ________ output in the short run and ________ output in the long run.
A. lower; potential
B. higher; higher
C. higher; potential
D. lower; higher
Answer: A
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The German government carries out an official foreign exchange intervention in which it uses dollars held in an American bank to buy French currency from its citizens. How is this accounted for in the balance of payments?
A) current account, French good export B) current account, German good import C) financial account, French asset export D) financial account, German asset export E) financial account, German asset import
What is the AA-curve? Why does it have a negative slope? What factors cause it to shift?
What will be an ideal response?
P-TV and QRS-TV are trying to decide whether to air a sitcom or a reality show in a given time slot. Viewers like both sitcoms and reality shows, but sitcoms are more expensive to produce than reality shows since real actors need to be hired. QRS-TV makes its decision first, and then P-TV observes that choice before making its decision. Both stations know all of the information in the decision tree below. 
Suppose QRS-TV enters into an agreement with P-TV that gives QRS-TV the exclusive right to air a reality show during this time slot. QRS-TV would have to pay P-TV ________ in order to persuade P-TV to enter into this agreement.
A. more than zero, but less than $5 million B. at least $10 million C. nothing D. at least $5 million
Someone who turns down an opportunity to purchase a Bible for $5 and then immediately pays $5 to attend a movie thereby expects to obtain more satisfaction from seeing the movie than from
A) cultivating the spiritual life. B) deepening his religious faith. C) owning the Bible just offered to him. D) reading the Bible.