Consumption expenditure decreases when ________ decreases.
A. The interest rate
B. The price level
C. Disposable income
D. Saving
Ans: C. Disposable income
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Starting from long-run equilibrium, a large increase in government purchases will result in a(n) ________ gap in the short-run and ________ inflation and ________ output in the long-run.
A. expansionary; higher; potential B. recessionary; higher; potential C. recessionary; lower; lower D. expansionary; higher; higher
A college bookstore offers both new and used Physics 101 textbooks. Vicki pays $120 for a new copy, Darrel pays $85 for a used copy. Who made an economically efficient choice?
A) Vicki B) Darrel C) Both Vicki and Darrel D) Neither one of them—they could have found a better deal on the Internet.
Unemployment taxes are collected from both employees and employers.
A. True B. False C. Uncertain
The IV estimator can be used to potentially eliminate bias resulting from
A) multicollinearity. B) serial correlation. C) errors in variables. D) heteroskedasticity.