Recessions are typically
A) unintended and disruptive.
B) easy to predict in advance.
C) the result of non-monetary disturbances.
D) events economists have a hard time explaining.
A
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The distinction between physical and financial capital is that
A) physical capital is equal to financial capital minus depreciation. B) financial capital depreciates and physical capital does not. C) the value of financial capital depends on the amount of available physical capital. D) physical capital is equal to financial capital plus depreciation. E) financial capital is used to purchase and operate physical capital.
Between 2015 and 2016, if an economy's exports rise by $8 billion and its imports fall by $8 billion, by how much will GDP change between the two years, all else equal?
A) The increase in exports is offset by the decrease in imports, so there is no change in net exports and no effect on GDP. B) Net exports will decrease GDP by $8 billion. C) Net exports will increase GDP by $8 billion. D) Net exports will increase GDP by $16 billion.
Bank capital can best be described as:
A) funds contributed by shareholder purchasers of a bank's stock plus the accumulated retaining earnings B) the accumulated amount of reserves held by a bank C) the location of most of the major banks of a country D) another name for bank assets
The substantial increase in household debt relative to income since the mid 1980s meant that in 2008 many households
a. had little savings or other reserve assets for use to deal with unexpected expenditures. b. could safely afford to purchase larger homes because housing is always a good investment. c. could spend everything they earned because their interest obligations on outstanding credit were low. d. would be able to easily adjust their current spending if their monthly payments on adjustable rate mortgages rose.