Effective usury laws cause:
A. a surplus in the market for loanable funds.
B. the quantity of loanable funds demanded to be brought into balance with the quantity
supplied.
C. the quantity of loanable funds demanded to exceed the quantity supplied.
D. the quantity of loanable funds supplied to exceed the quantity demanded.
Answer: C
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Starting from long-run equilibrium, a large tax increase will result in a(n) ________ gap in the short-run and ________ inflation and ________ output in the long-run.
A. recessionary; lower; potential B. expansionary; lower; potential C. expansionary; higher; potential D. recessionary; lower; lower
If the price level is fixed, then an increase in government spending will lead to
A) a larger increase in nominal GDP than in real GDP. B) a smaller increase in nominal GDP than in real GDP. C) no increase in either nominal GDP or real GDP. D) an increase in nominal GDP by the same amount as an increase in real GDP.
The market structure in which there is only one producer is called
a. monopoly b. oligopoly c. monopolistic competition d. perfect competition e. duopoly
In 2000, a major U.S. oil company began exploration off the southeastern coast of the United States. Suppose the company discovers huge reserves of natural gas. Using the aggregate demand/ aggregate supply model, predict what shifts will occur and what will happen to output and prices in both the long and short runs