One of the primary objections to the new classical model is that ________
A) firms could easily get information about price movements and so would not be fooled for very long
B) price is negatively related to quantity demanded, but positively related to quantity supplied
C) business cycles are relatively brief in duration
D) it failed to incorporate rational expectations into its presentation
A
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Which of the following policies are likely to increase national savings?
a. running larger government budget deficits. b. decreasing taxes on stock dividends. c. reducing taxes on consumption. d. having to pay higher interest rates on the national debt. e. none of the above.
James used $200,00 . from his savings account that paid an annual interest of 10% to purchase a hardware store. After one year, James sold the business for 300,000 . His accountant calculated his profit to be:
a. $300,000 b. $100,000 c. $80,000 d. $20,000
If AS increases at a faster rate than AD, the result will be
a. demand-side inflation. b. supply-side inflation. c. falling prices. d. stable prices.
Increase in business taxes will ________ the expenditure curve:
A) decrease.
B) increase.
C) not change.
D) none of the above.