With an increase in the budget deficit, the open-economy outcome compared to the closed-economy outcome features a ___________ in Real GDP
A) larger increase
B) smaller increase
C) larger decrease
D) smaller decrease
B
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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 balance sheet for the central bank of Pecunia is shown below: Central Bank Balance Sheet Assets Liabilities Foreign assets $1,000 Deposits held by private banks $500 Domestic assets $1,500 Currency in circulation $2,000 Please write the
new balance sheet if the bank sells $100 worth of foreign bonds for domestic currency.
If the demand for a monopolist's product increases, its
A) marginal revenue increases, making it more profitable to hire more workers. B) marginal revenue increases, making it more profitable to hire fewer workers. C) marginal revenue decreases, making it more profitable to hire more workers. D) marginal revenue decreases, making it more profitable to hire fewer workers.
A change in a factor's price will have a greater effect on the quantity of the factor demanded the:
A. Smaller the change in the factor's price B. Smaller the factor's share of total cost of production C. More elastic is the demand for the product the factor helps to make D. More inelastic is the demand for the product the factor helps to make