In the Keynesian model of an open economy, a temporary decrease in government purchases would ________ the domestic real interest rate and ________ net desired saving (desired saving less desired investment) in the economy
A) lower; increase
B) lower; decrease
C) raise; increase
D) raise; decrease
A
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________ behavioral assumption about humans was that people usually act in a rational, self-interested way
A) Adam Smith's B) Janet Yellen's C) Karl Marx's D) Thomas Malthus's
Suppose that an MBA degree creates no externality because the benefits of an MBA are internalized by the student in the form of higher wages. If there are no government subsidies for MBAs, then which of the following statements is correct?
a. The equilibrium quantity of MBAs will equal the socially optimal quantity of MBAs. b. The equilibrium quantity of MBAs will be greater than the socially optimal quantity of MBAs. c. The equilibrium quantity of MBAs will be less than the socially optimal quantity of MBAs. d. There is not enough information to answer the question.
Figure 10-7
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Which of the diagrams in Figure 10-7 shows an economic recession caused primarily by a change aggregate demand?
A. (A) B. (B) C. (C) D. (D)
If steak and potatoes are complements, when the price of steak goes up, the demand curve for potatoes:
A) shifts to the right. B) shifts to the left. C) stays the same. D) shifts to the right and then moves back.