The aggregate quantity of goods and services demanded changes as the price level falls because
a. real wealth falls, interest rates rise, and the dollar appreciates.
b. real wealth falls, interest rates rise, and the dollar depreciates.
c. real wealth rises, interest rates fall, and the dollar appreciates.
d. real wealth rises, interest rates fall, and the dollar depreciates.
d
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Suppose an economy operates at a real GDP level of $855, where saving = $400; investment = $95; government spending = $365; taxes = $130; imports = $210; exports = $170 . Which of the following statements is true in the light of the given information?
a. Aggregate expenditures will fall, because total injections exceed total leakages by $110. b. Real GDP will increase, because total injections are less than $855. c. The economy will be in equilibrium, because leakages equal injections. d. Real GDP will fall, because total leakages exceed total injections by $110. e. Inventories will rise, because planned saving exceeds planned investment.
When the government levies a $100 million tax on people's income and puts the $100 million back into the economy in the form of a spending program, such as new interstate highway construction, the:
A. tax, then, generates a $100 million decline in real GDP. B. level of real GDP expands by $100 million. C. effect on real GDP is uncertain. D. tax multiplier overpowers the income multiplier, triggering a rollback in real GDP.
When a physician understands the treatment options better than the patient
Insurance makes transactions complex because A. it adds parties to medical transactions. B. different insurers have different payment rules and rates. C. different insurers have different claim forms. D. All of the above.
The quantity demanded is
A) always equal to the equilibrium quantity. B) independent of the price of the good. C) the amount of a good that consumers plan to purchase at a particular price. D) independent of consumers' buying plans.