If the economy is producing output at the potential level of GDP, then:
a. an expansionary fiscal policy will increase real GDP in the long run.
b. deficit spending by the federal government will increase prices in the long run.
c. deficit spending will increase both, the real GDP and the prices in the long run.
d. a tax increase will not lower the aggregate demand.
b
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The figure above shows how the sales of the video game "Tomb Raider—Lara Retires" change when the advertising spent on the game changes
Is the relationship between advertising and the number of games sold positive, negative, or neither? Explain your answer.
An import tariff will cause the terms of trade of the ________ country to ________ and will ________ the country
A) importing; improve; benefit B) exporting; improve; benefit C) importing; suffer; harm D) exporting; improve; harm E) importing; improve; harm
Every economy has a(n) _______ given by the fundamental factors of growth.
A. actual inflation rate B. actual growth rate C. potential growth rate D. potential inflation rate
Consider a market consisting of two firms where the inverse demand curve is given by P = 500 ? 2Q1 ? 2Q2. Each firm has a marginal cost of $50. Based on this information, we can conclude that consumer surplus in the different equilibrium oligopoly models will follow which of the following orderings?
A. CSBertrand > CSStackelberg > CSCournot > CSCollusion B. CSBertrand > CSCournot > CSStackelberg > CSCollusion C. CSStackelberg > CSBertrand > CSCournot > CSCollusion D. CSCollusion > CSStackelberg > CSCournot > CSBertrand