If initial equilibrium real Gross Domestic Product (GDP) is $500 billion, MPC = 0.9, and autonomous investment increases $40 billion, equilibrium real Gross Domestic Product (GDP) will be
A. $800 billion.
B. $540 billion.
C. $600 billion.
D. $900 billion.
Answer: D
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In Figure 4-10 above, if the Fed's goal is to hold income constant, contractionary fiscal policy combined with the Fed's response takes us from points
A) B to D. B) D to B. C) A to C. D) C to A.
When Crest claims that its toothpaste product whitens teeth more than the products of its competitors, Crest is practicing
A) product differentiation. B) libel. C) marginal revenue pricing. D) marginal cost pricing.
Assume that the central bank purchases government securities in the open market. If the nation has highly mobile international capital markets and a flexible exchange rate system, what happens to the quantity of real loanable funds per time period and reserve-related (central bank) transactions in the context of the Three-Sector-Model?
a. There is not enough information to determine what happens to these two macroeconomic variables. b. The quantity of real loanable funds per time period rises, and reserve-related (central bank) transactions remains the same. c. The quantity of real loanable funds per time period rises, and reserve-related (central bank) transactions become more positive (or less negative). d. The quantity of real loanable funds per time period falls, and reserve-related (central bank) transactions become more negative (or less positive). e. The quantity of real loanable funds per time period and reserve-related (central bank) transactions remain the same.
The explanations for the slopes of the aggregate demand and short-run aggregate supply curves are the same as the explanations for the slopes of demand and supply curves for specific goods and services
a. True b. False Indicate whether the statement is true or false