According to the rational expectations theory, monetary policy is fully anticipated and therefore only affects:
a. the level of real GDP
b. the level of real investment.
c. the price level.
d. the level of real consumption.
e. the level of exports.
c
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If the marginal propensity to save of an economy is 0.4, then the simple spending multiplier is: a. 2.5
b. 0.6. c. 1.67. d. 1.
What does a balance of trade deficit imply?
a. exports of goods and services exceed imports of goods and services b. imports of goods and services exceed exports of goods and services c. investment income received from abroad exceeds investment income paid to foreigners d. investment income paid to foreigners exceeds investment income received from abroad e. investment by foreigners exceeds domestic investment in other countries
The excess of government spending over tax collections is:
A. the government budget deficit. B. national wealth. C. national saving. D. national income.
Microeconomics examines the
A) total household expenditures. B) behavior of the economy as a whole. C) aggregate business spending. D) decision making undertaken by individual households.