If a country has a large percentage of its population under 15 years old, then compared with other countries, this creates
a. a problem because they consume more than they produce
b. a problem because they cause more capital goods to be produced
c. a benefit because they boost demand for consumption goods
d. a benefit because they cause more capital goods to be produced
e. neither a problem nor a benefit since age is irrelevant
A
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If the crowding-out effect is complete and the marginal propensity to save is 0.25, then an increase in government spending of $100 billion will generate how much more real GDP?
A) $0 B) $400 billion C) $25 billion D) $100 billion
Differentiate between a change in demand and a change in quantity demanded
What will be an ideal response?
Explain the income effect and the substitution effect due to an increase in the wage rate
What will be an ideal response?
When the Federal Reserve raises the growth rate of the money supply to a permanently higher level, this produces ________ in real GDP and ________ in the inflation rate
A) a permanent increase, a permanent increase B) a permanent increase, a temporary increase C) no change, a temporary increase D) a temporary increase, a temporary increase E) a temporary increase, a permanent increase