Complete crowding out implies that a government deficit financed by selling bonds to the nonblank public will
A) have no effect on aggregate demand.
B) reduce aggregate demand.
C) increase aggregate demand.
D) reduce aggregate demand in the short run but cause demand to increase in the long run.
A
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If cars are normal goods, a fall in income will
a. Increase the demand for cars b. Decrease the demand for cars c. Have no effect on the demand for cars d. None of the above
Refer to Figure 22.2 for a perfectly competitive firm. The profit-maximizing quantity of output is
A. B. B. C. C. D. D. E.
A public good:
A. can be profitably produced by private firms. B. is characterized by rivalry and excludability. C. produces no positive or negative externalities. D. is available to all and cannot be denied to anyone.
In the graph, when disposable income is _______, saving is zero.
A. 0
B. 1000
C. 2000
D. 3000