Balancing the budget over the business cycle involves running _________ during recession years and _____ during economic booms.
Fill in the blank(s) with the appropriate word(s).
deficits; surpluses
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Our most important trading partner is _____________.
Fill in the blank(s) with the appropriate word(s).
With higher future taxes
A) current consumption declines. B) current consumption stays the same. C) current consumption increases. D) current consumption depends on other factors.
Answer the following statements true (T) or false (F)
1) Even if a firm is found guilty of price fixing, after paying all imposed fines, it is still possible for the firm to earn positive economic profit from the price fixing scheme. 2) A manager of a firm located in the United States that sells some of its products abroad needs to comply only with United States antitrust law as the firm is only bound by the laws of the country in which it is located. 3) If a luxury handbag firm enters into an agreement with its distributors by setting the minimum price its distributors can resell its handbags, United States antitrust agencies could examine this agreement using the rule-of-reason. 4) If a software company enters into an agreement with its distributors to only resell its software in 5 specific states, under United States antitrust laws, this agreement is illegal per se. 5) If a software company charges different prices for its product in different areas of the United States, under United States antitrust laws, this agreement is illegal per se.
If the economy produces 36 consumer goods and 12 capital goods the economy would be producing __________________ (outside/on/inside) the production possibilities curve.
Hypothetical Production Schedule for a Two-Product Economy
