Starting from long-run equilibrium, a war that raises government purchases results in ________ output in the short run and ________ output in the long run.
A. lower; potential
B. higher; potential
C. higher; higher
D. lower; higher
Answer: B
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The alternative to the use of money by the members of a society is
A) barter. B) borrowing. C) division of labor. D) from each according to ability, to each according to need. E) payment by check.
The demand for a good is more price elastic
A) if closer substitutes are available. B) if the good is a necessity rather than a luxury. C) if the share of the good in the average consumer's budget is smaller. D) in the short run than in the long run.
Most nations do not push the rate of economic growth to the maximum because
a. it would be impossible to do so b. they do not know how to do so c. there is an opportunity cost associated with economic growth d. maximum growth would create an inefficient economy e. government budget deficits prevent them from doing so
If a nation is selling more goods and services to foreigners than it is buying from them, then on net it must be selling assets abroad
a. True b. False Indicate whether the statement is true or false