A closed economy does not engage in international trade, therefore
a. national saving is less than investment (S < I).
b. net exports (NX) are zero.
c. Y - C - G > I.
d. national saving is zero.
b
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If a firm accumulates unwanted inventories, then it
A) must hire more workers. B) will increase its production. C) has actual investment equal to its planned investment. D) will decrease its production. E) has actual investment that is less than its planned investment.
Long-run macroeconomic equilibrium occurs when
A) aggregate demand equals short-run aggregate supply and they intersect at a point on the long-run aggregate supply curve. B) structural and frictional unemployment equals zero. C) aggregate demand equals short-run aggregate supply. D) output is above potential GDP.
Which of the following explains why a $100 billion reduction in consumption spending might decrease equilibrium real GDP by more than $100 billion?
A. Say's law. B. The quantity theory of money. C. Flexible resource prices. D. The multiplier principle.
An asset's price and rate of return:
A. are independent of each other. B. can be either inversely or directly related. C. are inversely related. D. are directly related.