If there is an active surplus (+) of +$30 billion and an actual deficit (-) of -$40 billion, then:
a. The full employment deficit must be -$70 billion.
b. The passive deficit (-) must be -$10 billion.
c. The full employment deficit (-) must be -$30 billion
d. The passive deficit (-) must be -$70 billion.
e. The passive surplus (+) must be +$40 billion.
.D
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If the percentage change in the price of a good is equal to the percentage change in the quantity demanded of that good, then the demand for that good is:
A. inelastic. B. unit elastic. C. elastic. D. perfectly elastic.
In the IS-LM model, the implicit assumption made about aggregate supply was that the
a. aggregate supply schedule was vertical because prices were flexible. b. aggregate supply schedule was horizontal because prices were fixed. c. aggregate supply schedule was upward sloping to the right because wages and prices were fixed. d. supply of output was fixed. e. none of the above.
In the short run, a reduction in the price of oil will cause
A) a reduction in output. B) an increase in the price level. C) a reduction in the interest rate. D) all of the above E) none of the above
Price leadership represents a situation where monopolistic firms:
A. Reduce their reliance on non price competition B. Form a cartel C. Face a kinked demand curve D. Tacitly collude