If the economy is on the flat portion of the AS curve
A. there is little crowding out of planned investment.
B. government spending, but not consumption, crowds out planned investment.
C. consumption, but not government spending, crowds out planned investment.
D. there is almost complete crowding out of planned investment.
Answer: A
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Economics is generally concerned with
A. the operation of banks and the stock market. B. business management. C. how resources are allocated among alternative goals. D. the right time to start a business.
The argument that an increase in aggregate demand, as a result of an increase in government purchases, will be offset by increases in savings (less current consumer spending) for future taxes is called:
a. the crowding out effect b. the Ricardian equivalence theorem c. the budget deficit effect d. the budget surplus effect
The unemployment rate was increasing from 6 percent to 7 percent could be interpreted as an increase in the natural rate of
A. inflation. B. unemployment. C. economic growth. D. aggregate supply.
Which of the following is a component of high powered money?
A) bonds held by banks, loans, and bank reserves B) currency in circulation plus bank reserves C) currency in circulation plus checkable deposits D) bonds held by banks plus checkable deposits E) the sum of currency in circulation, bank reserves, and checkable deposits