If firms sell less than is expected, actual investment increases because ________, which is counted as investment.
A. the government buys the unsold goods
B. households buy the unsold goods are bargain prices
C. the unsold goods are distributed to poor households
D. the unsold goods are added to inventory
Answer: D
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Economists use the term "demand" to refer to
A. a particular price-quantity combination on a stable demand curve. B. an upsloping line on a graph that relates consumer purchases and product price. C. a schedule of various combinations of market prices and quantities demanded. D. the total amount spent on a particular commodity over a fixed time period.
Which firm did the Treasury allow to fail during the financial crisis?
A) J.P. Morgan B) Bear Stearns C) Lehman Brothers D) American International Group (AIG)
Over the 1980s and 1990s, countries with sound fiscal, monetary, and trade policies and strong rule of law combined with large amounts of aid:
A. still failed to grow, indicating new methods for furthering development are needed. B. grew at 1 percent, indicating the necessity of good policy in conjunction with aid. C. saw GDP shrink by 1 percent, indicating corruption and inefficient use of funds is rampant. D. None of these statements is true.
The Fed conducts reverse repurchase agreements with:
A. banks only. B. the federal government only. C. banks and financial institutions other than banks. D. only financial institutions that are not banks, such as the federal government.