Refer to the diagram, in which Q f is the full-employment output. A contractionary fiscal policy would be most appropriate if the economy's present aggregate demand curve were at:
A. AD 0 .
B. AD 1 .
C. AD 2 .
D. AD 3 .
D. AD 3 .
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Over the past 100 years real GDP per person in the United States, on average, has
A) decreased by about 5 percent per year. B) increased by about 2 percent per year. C) increased by about 5 percent per year. D) increased by about 10 percent per year.
Foreign outsourcing is
A) the transfer of operations to foreign contractors. B) an example of internalization. C) an example of foreign direct investment. D) currently illegal in the U.S. E) the substitution of immigration for foreign direct investment.
An example of a commitment device would be:
A. a swear jar that you and your friends agree must be paid $5 each time someone swears. B. putting a note on the cookie jar that you want to lose weight. C. buying yourself an ice cream after going to the gym. D. All of these are examples of commitment devices.
If disposable income increases by $100 million, and consumption increases by $90 million, then the marginal propensity to consume is
What will be an ideal response?