When will the difference between the actual deficit and the structural deficit be the largest?
a. in an inflationary gap
b. at full employment
c. at potential real GDP
d. in a recession
d
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Refer to Figure 27-1. Suppose the economy is in a recession and expansionary fiscal policy is pursued. Using the static AD-AS model in the figure above, this would be depicted as a movement from
A) C to B. B) A to B. C) A to E. D) B to C. E) B to A.
A demand curve that has constant price elasticity of demand coefficient equals to one at all points is a(n):
a. rectangular hyperbola. b. downward-sloping straight line. c. upward-sloping straight line. d. none of these.
Market failure occurs when supply and demand curves only reflect:
a. private or market costs and benefits. b. external costs and benefits. c. external benefits. d. external costs.
This graph demonstrates the domestic demand and supply for a good, as well as a tariff and the world price for that good.
According to the graph shown, the original world price is ________ and the amount of the tariff is ________.
A. $100; $30 B. $215; $115 C. $175; $45 D. $100; $130