People will be likely to spend a higher percentage of any additional income when _____
Fill in the blank(s) with the appropriate word(s).
they believe that the increase is permanent
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Most economists support open trade because it increase our choices as consumers, lowers costs for producers, increases competition and innovation, and leads to greater diffusion of technological change
Indicate whether the statement is true or false
Refer to above Table 2-2. What is the increase in real GDP between years 1 and 2 at fixed year 1 prices?
A) 4.3% B) 3.3% C) 2.5% D) 1.9%
What situation gives rise to a surplus?
A) The market clearing price of the good is too high. B) The current price of the good is below its market clearing price. C) The current price of the good is above its market clearing price. D) Supply of the good decreases, but the market price is not permitted to change.
According to the Keynesian view, an unanticipated reduction in spending will
a. increase the demand for goods and services. b. raise business inventories and lead to a decline in output. c. lead to lower interest rates, which will stimulate aggregate demand and keep the economy at full employment. d. lead to a lower price level, which will quickly guide the economy to full-employment equilibrium.