One of reasons the government may choose to spend would be the:
A. real interest rates increase.
B. beliefs about what citizens may need.
C. government expected to earn a large return on its spending.
D. real interest rates decrease.
Answer: B
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In a closed economy with no government, aggregate expenditure is
A) consumption plus investment. B) saving plus investment. C) consumption plus the MPC. D) MPC + MPS. E) none of the above.
Depository institutions do all the following EXCEPT
A) minimize the cost of obtaining funds. B) create liquidity. C) pool risks. D) create required reserve ratios.
For the monopolistically competitive firm,
a. competition is blocked by barriers to entry b. limit pricing can forestall competition indefinitely c. marginal revenue is less than the product's price d. price discrimination is a key tool e. marginal revenue is equal to the product's price
After the imposition of the quota, the numbers of TVs imported will drop by ________ units.
A. 100,000 B. 40,000 C. 20,000 D. 80,000