An open market purchase, a decrease in the discount rate, and a decrease in the reserve requirement would shift the aggregate demand curve rightward
Indicate whether the statement is true or false
TRUE
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If the government purchases multiplier equals 2, and real GDP is $14 trillion with potential real GDP $14.5 trillion, then government purchases would need to increase by ________ to restore the economy to potential real GDP
A) $7.25 trillion B) $1 trillion C) $500 billion D) $250 billion
The direct exchange of one good or service for another is called
A) a token exchange. B) a standard of deferred payment. C) the exchange of purchasing power. D) barter.
Backward induction is a useful tool for:
A. finding an optimal strategy in a sequential game. B. analyzing the decisions in a prisoner's dilemma-type game. C. finding an optimal strategy in a simultaneous game. D. Backward induction is useful in any of these games.
Which of the following does Luddite reasoning get correct?
A. Historically, the demand for labor has actually increased as technology has advanced. B. New technology frequently causes some specialized labor skills to become obsolete. C. New technology tends to raise total output, leading to an increase in the demand for labor. D. Labor is necessary for building and maintaining machines, and so increased demand for machines increases the demand for labor.