Government spending:
A. tends to increase with increases in the price level.
B. tends to increase with decreases in the price level.
C. remains generally unaffected by changes in the price level.
D. is not a component of aggregate demand.
C. remains generally unaffected by changes in the price level.
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X is exports, M is imports, T is net taxes, G is government expenditure, C is consumption expenditure, S is saving, and I is investment. The government sector balance is equal to
A) T - G. B) C + S + T. C) S - I. D) X - M.
Which of the following countries is not a member of NAFTA?
A) Canada. B) The United States of America. C) Mexico. D) All three countries form part of NAFTA.
A backward-bending labor supply curve implies that
A) the substitution effect dominates the income effect at higher wage rates but not at lower wage rates. B) the substitution effect dominates the income effect at lower wage rates but not at higher wage rates. C) leisure is an inferior good. D) workers are irrational.
Whenever the interest rate goes up, the price of bonds will go down.
Answer the following statement true (T) or false (F)