The logic of the multiplier effect applies
a. only to changes in government spending.
b. to any change in spending on any component of GDP.
c. only to changes in the money supply.
d. only when the crowding-out effect is sufficiently strong.
b
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Which of the following statements about the FDIC is untrue?
a. The FDIC conducts bank audits and examinations. b. The FDIC helps prevent bank failures. c. The FDIC is owned by member banks. d. The FDIC provides demand deposit insurance for participating banks. e. The FDIC was created in 1933.
The net exports effect is the inverse relationship between net exports and the ____ of an economy.
A. potential real GDP B. chain-price deflator C. price level D. consumption spending
Which of the following are signals to the owners of scarce resources about the best uses of those resources?
A. Economic indicators B. The accounting cost of those resources C. Government regulations D. Profits of businesses
You borrow $10,000 at an interest rate of 5% to open Movies Galore, a DVD rental store. You will earn an economic loss if
A. the return on your investment is less than 5%. B. the return on your investment is exactly 5%. C. the return on your investment is greater than 5%. D. indeterminate from given information.