A recessionary gap:
A. is of little consequence in a capitalist economy.
B. represents actual physical output lost.
C. implies an equilibrium level of output less than the full-employment level.
D. will automatically close, according to the Keynesian model.
Answer: C
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The probit model
A) is the same as the logit model. B) always gives the same fit for the predicted values as the linear probability model for values between 0.1 and 0.9. C) forces the predicted values to lie between 0 and 1. D) should not be used since it is too complicated.
The issuance of debt involves some intergenerational transfer of income; long after the debt is issued, a new generation of taxpayers must make interest payments on the debt
a. True b. False Indicate whether the statement is true or false
The additional revenue a firm obtains from employing one more unit of capital is called the
a. marginal revenue product of capital b. total product of capital c. marginal product of capital d. production function e. marginal product of labor
All economic transactions involve only buyers and sellers; no third parties are involved
a. True b. False Indicate whether the statement is true or false