How does government expenditure discourage some private investment?
Government often borrows money from the market to meet its expenditure. Government borrowing tends to increase market interest rates. Private investment will fall when there is an increase in the interest rate as the interest rate and investment are negatively related.
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A movement upward along an upward-sloping Engel curve corresponds to
A) upward-sloping indifference curves. B) crossing indifference curves. C) a rotation in the budget constraint. D) a parallel shift in the budget constraint.
When a perfectly competitive firm is in long-run equilibrium, economic profits
A) are positive. B) are zero. C) are negative. D) may be positive, zero or negative depending upon costs.
Which of the following would cause the supply of dollars curve in the United States to shift to the right?
A. Japanese imports become less popular. B. The value of the dollar falls. C. The supply of dollars decreases. D. Japanese imports became more popular.
________ believed that to increase agricultural output, people would be forced to farm land more intensively, in which case the returns to successive increases in population would diminish.
A. Thomas Malthus and David Ricardo B. John Maynard Keynes and Milton Friedman C. Arthur Okun and Arthur Laffer D. Adam Smith and John Baptiste Say