If full employment GDP is $1 trillion greater than equilibrium GDP, and there is a recessionary gap of $400 billion, the multiplier is
A. 1.
B. 2.5.
C. 4.
D. 5.
B. 2.5.
You might also like to view...
The primary factor that caused most economists to lose their faith in the classical approach to macroeconomic policy was
A) the high levels of unemployment that occurred during the Great Depression. B) the presence of both high unemployment and high inflation during the 1970s. C) the theoretical proof that classical ideas were invalid. D) the evidence that classical ideas were useful during economic booms, but not during economic recessions.
If an up-scale jewelry maker sells its products to retailers with the explicit condition that the retailers may not resell the products below a specified price, this is an example of ________.
A) monopolization B) market division C) price fixing D) resale price maintenance
In evaluating public projects, a higher interest rate (r) will favor those projects which
a. have costs and benefits occurring in the more distant future. b. have costs and benefits occurring in the more immediate future. c. have benefits occurring in the more immediate future and costs occurring in the more distant future. d. have benefits occurring in the more distant future and costs occurring in the more immediate future.
Which of the following statements is most likely true?
a. In recent decades, the export/GDP ratio has generally fallen, both worldwide and for the U.S. economy. b. In recent decades, the export/GDP ratio has generally risen worldwide, but not for the U.S. economy. c. In recent decades, the export/GDP ratio has generally risen, both worldwide and for the U.S. economy. d. In recent decades, the export/GDP ratio has generally fallen worldwide, but not for the U.S. economy.