Either an increase in wealth or an increase in population would increase consumption and aggregate demand, other things equal
a. True
b. False
Indicate whether the statement is true or false
True
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When there is an expansionary gap, inflation will ________, in response to which the Federal Reserve will ________ real interest rates, and output will ________.
A. decline; lower; expand B. increase; raise; decline C. decline; lower; decline D. decline; raise; decline
Which of the following is true regarding demand?
i. Demand is the relationship between quantity demanded and the price of a good when all other influences on buying plans remain the same. ii. Demand refers to one quantity at one time. iii. "Demand" and "quantity demanded" are the same thing. A) i only B) both i and ii C) iii only D) ii only E) both ii and iii
The federal budget deficit went over $100 billion for the first time in
A. 1977. B. 1979. C. 1982. D. 1984.
Lilliput imports rope from Brobdingnag, where rope producers are subsidized by the government because of their great political clout. The most efficient policy from the standpoint of Lilliput is to
a. continue trading at the subsidized price. b. stop trading with Brobdingnag. c. place a tariff on rope imports to offset the subsidy. d. give a similar subsidy to the rope producers of Lilliput.