The self-correcting property of the economy means that output gaps are eventually eliminated by:

A. increasing or decreasing potential output.
B. government policy.
C. decreasing inflation only.
D. increasing or decreasing inflation.


Answer: D

Economics

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When the government's expenditures exceed its tax revenues, the budget

A) has a deficit and the national debt is increasing. B) has a surplus and the national debt is increasing. C) is balanced and the national debt is increasing. D) has a deficit and the national debt is decreasing. E) None of the above because by law the government's expenditures cannot exceed its tax revenue.

Economics

Sweatshirts and tee-shirts are complements in consumption and the price of a sweatshirt increases. As a result, the demand for

A) sweatshirts will increase that is, the demand curve will shift rightward. B) tee-shirts will increase that is, the demand curve will shift rightward. C) sweatshirts will decrease that is, the demand curve will shift leftward. D) tee-shirts will decrease that is, the demand curve will shift leftward.

Economics

The initial bond purchaser

A. Lends funds directly to the bond issuer. B. Earns par value on the bond. C. Borrows funds directly from the bond issuer. D. Shares in the company's profits.

Economics

Which nation had the largest share of world exports in 2011?

A. Japan B. Germany C. China D. United States

Economics