When actual GDP does not rise as fast as potential GDP, the economy most likely will experience
A. inflation.
B. recession.
C. economic growth.
D. falling unemployment.
Answer: B
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Suppose that domestic investment in Japan is 20.2% of GDP, and Japanese national savings is 24% of GDP. What is Japan's foreign investment as a percentage of GDP?
A) 1.19% B) 3.8% C) 27.8% D) 44.2%
A consumer could screen the quality of a pizza joint by
A) asking friends. B) using online rating sites. C) watching the chef prepare the pizza. D) All of the above.
The effect of an initial spending change causing a larger change in overall output is:
A. the multiplier effect B. crowding out. C. the income effect. D. the substitution effect.
Which of the following is an example of a nudge?
A. Income is redistributed through tax and spending programs. B. An employee must check a box to opt out of a retirement savings program. C. A farmer's market raises prices because a storm destroyed crops. D. Government taxes cigarettes.