In the Keynesian model, if planned investment exceeds planned saving at full-employment output,
a. unemployment is likely to develop.
b. government spending may be needed to balance the economy.
c. inflation is likely to occur.
d. None of these.
c. inflation is likely to occur.
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Compare the views of Keynesian and mainstream economists on the effects fiscal stimulus has on real GDP and employment
What will be an ideal response?
What factors are part of the leading economic indicators?
a. Employment, personal income, and production b. Interest rates and average duration of unemployment c. Consumer confidence, consumer spending, and machinery orders d. House sales, personal income, and interest rates
A curve showing the amount of real output we collectively wish to purchase at various alternative price levels is called the
A. aggregate production function. B. aggregate demand curve. C. Phillips curve. D. aggregate supply curve.
A multinational enterprise (MNE) produces a component in the United Kingdom, where the corporate income tax rate is 60 percent. It produces its final product in Taiwan, where the corporate income tax rate is 25 percent. The cost of the component produced in the United Kingdom is $4 per unit. The components can be shipped to Taiwan at almost no cost, and there is no tariff on the component when it is imported into Taiwan. Each unit of the final product requires one unit of the component. Other production costs in Taiwan to complete the final product are $14 per unit. The final product price, when it is sold by the Taiwan affiliate to outside buyers, is $20 per unit. If the goal of the multinational enterprise is to maximize its global after-tax profit, which of the following three choices
should the controller of the multinational enterprise favor? Why?a. Charge a transfer price of $4 per unitb. Charge a transfer price of $5 per unitc. Charge a transfer price of $6 per unit What will be an ideal response?