Which statement best describes the current account balance in the short run?
A) Monetary expansion lowers the current account balance.
B) Monetary expansion keeps the current account balance the same.
C) Fiscal expansion increases the current account balance.
D) Fiscal expansion keeps the current account balance the same.
E) Monetary expansion increases the current account balance.
E
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Economic variables we are most interested in are
a. real variables, but we usually observe nominal variables. b. nominal variables, but we usually observe real variables. c. real variables, which we usually observe. d. nominal variables, which we usually observe.
A Keynesian short-run aggregate supply curve has a flatter portion and a steep portion. How does a decrease in aggregate demand affect the actual real GDP differently across these two portions?
a. There is a large decrease in the actual real GDP across the flatter portion and a small decrease in the actual real GDP across the steep portion. b. There is a large increase in the actual real GDP across the flatter portion and a small increase in the actual real GDP across the steep portion. c. There is a small decrease in the actual real GDP across the flatter portion and a large increase in the actual real GDP across the steep portion. d. There is a small increase in the actual real GDP across the flatter portion and a large increase in the actual real GDP across the steep portion.
Asymmetric information is
A) when a market failure occurs. B) an externality. C) when the producer has information on the product that the consumer lacks. D) the regulatory price for a natural monopoly.
When the price of DVDs falls relative to movie and restaurant prices, and consumers buy more of the DVDs, economists call this
A. substitution. B. satisfaction. C. marginalization. D. indifference.