What real or potential economic problem is posed by the public debt and its growth?
A. It can lead the nation to bankruptcy.
B. It may crowd out investment in new capital goods.
C. It causes expansionary economic policy making.
D. It places an unwarranted economic burden on future generations.
Answer: B
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In a free-market economy, prices coordinate society’s decisions about
A. how and for whom to produce. B. what, how, and for whom to produce. C. how and for whom to produce but not how much to produce. D. how much and for whom to produce but not how to produce.
Table 36-2 ? Domestic ? ? ? GDP Expenditure ? Exports Imports Total Expenditures (Y) C+ I + G (X) (IM) C+ I + G + (X?IM) $2,500 $3,100 $650 $250 _____ 3,000 3,400 650 300 _____ 3,500 3,700 650 350 _____ 4,000 4,000 650 400 _____ 4,500 4,300 650 450 _____ 5,000 4,600 650 500 _____ 5,500 4,900 650 550 _____ In Table 36-2, assume that exports rise to $900. How large is the multiplier?
A. 5 B. 4 C. 2.5 D. 2
A form of market structure characterised by few firms, each large enough to influence market price is;
(a) Perfect Competition. (b) Monopolistic Competition. (c) Monopoly. (d) Oligopoly.
Consider the price paid for debt issued by the State of California. Which of the following would lead to a decrease in the value of State of California bonds?
A. The State of California pays back its previous bonds ahead of schedule. B. The State of California bonds have a shorter maturity. C. The State of California bonds are in small dollar amounts. D. The State of California experiences a fiscal crisis that makes it less likely it will be able to honor its interest payments.