To ask "what causes a recession" is the same as asking
A) "why does supply meet demand?"
B) "what is the link between price elasticity of demand and price elasticity of supply?"
C) "why have so many individuals made errors all at once?"
D) "why have price controls failed us?"
C
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Suppose that when the price of ice cream increases, Liza decreases her purchase of hot fudge. To Liza
A) ice cream is a normal good and hot fudge is an inferior good. B) ice cream and hot fudge and substitutes. C) ice cream and hot fudge are normal goods. D) ice cream and hot fudge are complements.
On the evening news you hear of a scientific study that directly links premature births to cigarette smoking. This is an example of
A) direct-model evidence. B) informed voter-model evidence. C) structural-model evidence. D) reduced-form evidence.
Consider a small open economy with desired national saving of Sd = 200 + 10,000rw and desired investment of Id = 1000 - 5000rw. If rw = 0.05, then a rise in government spending of 50 with no change in private saving causes net exports to become
A) 100. B) 50. C) -50. D) -100.
Most government securities transactions take place in the
A) futures market. B) commodities market. C) over-the-counter dealer market. D) New York securities market.