The lower portion of the circular flow model contains factor markets in which households provide:
a. output of all final goods and services produced.
b. savings, spending, and investment.
c. labor, money, and machines.
d. none of these.
d
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I) The growth rate of Eduland's money supply in a particular year was 8.5%
What was the growth rate of real GDP if the inflation rate in the same year was 4%? ii) What is likely to happen if the growth rate of money supply doubles in the following year, while the growth rate of real output remains unchanged?
In the income-expenditure model, if autonomous saving increases by $15 billion, _____
a. the aggregate expenditure line shifts upward by $15 billion b. planned investment increases by $15 billion c. the aggregate expenditure line shifts downward by $15 billion d. planned investment decreases by $15 billion e. the equilibrium level of real GDP demanded decreases by $15 billion
Cost-benefit analysis is
A. a set of practical procedures for guiding public expenditure decisions. B. used by the private sector to determine whether certain projects should be undertaken. C. difficult when benefits and costs are hard to evaluate. D. mindful of changes over time. E. all of these answer options are correct.
The main policy conclusion of the rational expectations theory is
a. fiscal policy lags are so long and variable that such policy is worthless, but monetary policy can stimulate output. b. monetary policy lags are so long and variable that such policy is worthless, but fiscal policy can stimulate output. c. both monetary and fiscal policy will affect real output if firms and households correctly anticipate the effects of changes in government policy. d. neither monetary nor fiscal policy will affect real output if firms and households correctly anticipate the effects of changes in government policy.