Starting from long-run equilibrium, a large increase in government purchases will result in a(n) ________ gap in the short-run and ________ inflation and ________ output in the long-run.
A. expansionary; higher; potential
B. recessionary; higher; potential
C. recessionary; lower; lower
D. expansionary; higher; higher
Answer: A
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Assortative mating means that
A) poor women and rich men tend to marry. B) rich women and rich men tend to marry. C) rich women and poor men tend to marry. D) there are limited incentives to marry anyone.
A decrease in the real interest rate outside of the United States will ________ the demand for the dollar and ________ the demand for foreign financial assets
A) increase; increase B) increase; decrease C) decrease; increase D) decrease; decrease
The labor supply curve shows how many workers are willing to work
A. at any given wage. B. in order to maximize the firm's profit. C. at the minimum wage. D. at any given time. E. in a particular industry.
Suppose a health insurance company notes that almost all of its customers are at a high risk of illness or injury. This is an example of:
A. public information. B. perfect information. C. a thick market. D. an adverse selection problem.