Refer to the below graphs. (Assume that the pre-migration labor force in Country A is 100 and that it is 150 in country B.) The migration of labor will:
A. Increase domestic output in both countries
B. Decrease domestic output in both countries
C. Increase domestic output in country A and decrease domestic output in country B
D. Decrease domestic output in country A and increase domestic output in country B
D. Decrease domestic output in country A and increase domestic output in country B
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Which of the following is a problem associated with extreme levels of poverty?
A) High life expectancy B) High infant mortality C) High literacy D) Low fertility
A study of estimated multipliers in the major econometric models shows that
A) the government-spending multiplier tends to increase and then later decrease over time. B) the monetary multiplier is much larger than the government spending multiplier. C) there is quite a bit of variation in the value of the multipliers among the models. D) A and C are both correct.
The techniques of regulation used in the U.S. are
(a) meant to solve basic problems, but they create others. (b) meant to re-enforce the "decisions of the marketplace." (c) meant to manage problems rather than solve them. (d) designed to make the economy more efficient than is possible with only the free market mechanism.
Assume the economy is in recession and real GDP is below full employment. The marginal propensity to consume (MPC) is 0.90, and the government follows Keynesian economics by using expansionary fiscal policy to increase aggregate demand (total spending). If an increase of $1,000 billion aggregate demand can restore full employment, the government should:
a. increase spending by $100 billion. b. decrease spending by $790 billion. c. increase spending by $1,000 billion. d. increase spending by $250 billion.