Suppose we have an economy in which G = 1100, t = 0.26, Y = 3800, and YN = 4000. At Y, the actual deficit is
A) 60.
B) 200.
C) 112.
D) 286.
E) -60.
C
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When the value of nominal GDP increases from one year to the next, we know that one or two things must have happened during that time:
A) The nation produced fewer goods and services and/or prices fell for goods and services. B) Consumption expenditure increased and/or corporate profits increased. C) Investment increased and/or payments to employees increased. D) The nation produced more goods and services and/or prices rose for goods and services. E) the value of real GDP must have increased and/or the price level must have decreased.
A change in the price of a good causes
A) an increase in supply. B) a decrease in supply. C) an increase in demand and a decrease in supply. D) a change in quantity supplied.
Suppose the production function for good q is given by q = 3K + 2 L where K and L are capital and labor inputs. Consider three statements about this function: I. The function exhibits constant returns to scale. II. The function exhibits diminishing marginal productivities to all inputs. III. The function has a constant rate of technical substitution. Which of these statements is true?
a. All of them. b. None of them. c. I and II but not III. d. I and III but not II. e. only I.
The construction of a price index is complicated by several factors, including changes in the quality of goods and services over time, the introduction of new products, and the disappearance of old, outmoded products
a. True b. False Indicate whether the statement is true or false