Which of the following causes the production possibilities curve to shift to the right?
a. d and e.
b. c and e.
c. A war.
d. The development of a new technology that improves productivity.
e. The discovery of oil reserves.
a
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The smaller the MPC: a. the smaller the fraction of an increase in AD due to an increase in government purchases that is consumption. b. the greater the fraction of an increase in AD due to an increase in government purchases that is consumption. c. the greater the change in government purchases required to achieve a given change in AD
d. (a) and (c)
Bond prices in the marketplace will fall when
a. interest rates fall. b. the company is losing money. c. interest rates rise. d. the company is making money.
Assume that the central bank purchases government securities in the open market. If the nation has low mobility international capital markets and a flexible exchange rate system, what happens to the GDP Price Index and current international transactions in the context of the Three-Sector-Model?
a. The GDP Price Index rises, and current international transactions becomes more positive (or less negative). b. The GDP Price Index rises, and current international transactions becomes more negative (or less positive). c. The GDP Price Index and current international transactions remain the same. d. The GDP Price Index rises, and current international transactions remain the same. e. There is not enough information to determine what happens to these two macroeconomic variables.
Once a Nash equilibrium has been found in a game:
A. the players always have an incentive to change their choice. B. no one in the game can be made better off. C. the players have no incentive to change their choice. D. a stable outcome is impossible.