Why is it true that domestic product and national income must be equal?
A. The IRS national accounting system assures that taxes equal total income.
B. The total amount of spending must equal total national sales.
C. The value of final product must equal the sum of resource income that produced it.
D. The total amount of income earned is eventually spent.
Answer: C
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When the interest rate falls in the money market, the quantity of money demanded ________ and the quantity of money supplied ________
A) increases; decreases B) decreases; increases C) stays the same; decreases D) increases; stays the same
An increase in deficit spending tends to raise interest rates, thereby resulting in a multiplier effect that is higher than what would be associated with an equivalent increase in consumption spending
a. True b. False Indicate whether the statement is true or false
Suppose the market clearing price is $10 and the price ceiling is $8. The price that prevails in the market will be
A. $8. B. $0. C. $10. D. less than $8.
Real standards of living can increase
A. if there is positive growth in the manufacturing sector. B. if the country is producing the same amount they traditionally have and are enjoying more leisure time. C. only if there is positive economic growth. D. only at the cost of increased urban congestion.