Which of the following best describes the crowding-out effect?
What will be an ideal response?
An increase in borrowing by the government will push interest rates upward, which will lead to a reduction in private spending.
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The above figure shows Bobby's indifference map for juice and snacks. Also shown are three budget lines resulting from different prices for snacks. This information could be used to determine
A) the slope of Bobby's demand curve for juice. B) the amount by which Bobby's demand curve for juice shifts when his income rises. C) the amount by which Bobby's demand curve for juice shifts when the price of snacks rises. D) All of the above.
What leads to chronic deficits on U.S. current account?
a. declining value of the dollar and uncertainty about its future b. devaluation of the dollar c. imports being greater than exports year after year d. foreigners buying up U.S. assets in the U.S. year after year e. more exports and fewer imports year after year
If the Fed wants to increase the money supply, it can __________ the required reserve ratio, conduct an open market __________, or __________the discount rate
A) lower; sale; raise B) lower; purchase; raise C) lower; purchase; lower D) raise; sale; lower E) raise; purchase; raise
The accompanying table below shows how total donations, average donations, total labor costs and average labor costs vary depending on the number of employees State U hires for its fundraising activities. Number of EmployeesTotal DonationsAverage DonationsTotal Labor CostsAverage Labor Costs1$30,000 $8,0002$42,426 $17,000 3 $17,321$27,000 4$60,000 $9,5005 $13,416$50,000 The President of State U decides to hire fundraising employees as long as their average benefit exceeds their average cost. This results in ________ employees being hired and a net benefit (total donations minus total labor costs) of ________.
A. 5; $67,080 B. 5; $17,080 C. 4; $22,000 D. 4; $60,000