The "interest rate effect" can be described as an increase in the price level that raises the interest rate and chokes off
A) government spending.
B) government spending and unplanned investment.
C) investment and consumption spending.
D) net exports.
Answer: C
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Compared to whites, blacks had disproportionately high mortality rates in:
a. the far southern colonies. b. the Caribbean colonies. c. the northern mainland colonies. d. the mid-Atlantic colonies.
A recent decline in interest rates made home construction more affordable for many families. The consequent increase in construction produced a rightward shift in the demand curves for construction materials. Economists would say that the change in demand for materials is due to
A. the principle of marginal productivity. B. rent seeking. C. diminishing marginal returns. D. derived demand.
Exhibit 9-2 A monopolistic competitive firm
?
To maximize long-run profits, the monopolistically competitive firm shown in Exhibit 9-2 will charge a price per unit of:
A. zero. B. $5. C. $10. D. $15.
Consider a closed economy described by AE (aggregate expenditures) = 800,000 + 0.75Y Assume that this economy is initially in equilibrium. But now the government implements a program to improve highways that will cost $1 million. This implies that equilibrium real GDP will:
a. decrease by $1 million. b. decrease by $4 million. c. increase by $1 million. d. increase by $4 million. e. decrease by $800,000.