Imagine two economies that are identical except that, for a long time, economy A has had a money supply of $1,000 billion while economy B has had a money supply of $1,500 billion. It follows that
a) the price level, but not real GDP is higher in country B.
b) real GDP and the price level are higher in country B.
c) real GDP, but not the price level, is higher in country B.
d) neither the price level or real GDP is higher in country B.
Ans: a) the price level, but not real GDP is higher in country B.
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The quantity of DVD players purchased declined in spite of a decline in price. This implies that the
A. supply curve for DVD players shifted to the left. B. demand curve for DVD players shifted to the right. C. demand curve for DVD players shifted to the left. D. supply curve for DVD players shifted to the right.
At present, the Social Security System
A) takes in more revenue than it spends on benefits. B) takes in less revenue than it spends on benefits. C) equates the revenue that it receives and the amount it spends on benefits. D) has no idea of just how much revenue it taking in.
Other things equal, if planned investment spending is greater than actual investment spending, then aggregate expenditure will be ________ real GDP and inventories will ________
A) greater than; rise B) greater than; fall C) less than; rise D) less than; fall
All of the following are economic explanations for why shopping carts have gotten bigger over the years.
a. more women in the marketplace have made spending time in the grocery store more costly. b. grocery stores now have a wider variety of items available. c. store owners are "tricking" customers in into buying more groceries by making them feel ashamed that their carts are not full. d. shoppers have become wealthier over the years and are willing to pay for the luxury of wide aisles and the big carts that go along with wider aisles.