As a result of the recent financial crisis, some analysts believed that the MPC in the U.S. declined. If this is true, the value of the multiplier is now
a. smaller.
b. larger.
c. the same.
d. magnified to a larger amount.
a
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Which of the following is true about a nation’s production possibilities curve?
a. a point inside the curve is a combination of products that is currently impossible to produce. b. a point outside the curve is a combination of products that is below capacity. c. a rightward shift of the curve illustrates economic growth. d. full employment is illustrated by a point inside the curve.
When a Chinese company builds an auto plant in the United States, the immediate result of this Chinese investment in the United States is a ________ item in the U.S. ________ account.
A. deficit; current B. surplus; current C. surplus; financial D. deficit; financial
In the diagram:
A. any rate of inflation is consistent with the natural rate of unemployment in the long run.
B. inflation can occur, but disinflation cannot occur.
C. unemployment rates exceeding the natural rate are permanent.
D. unemployment rates less than the natural rate are permanent.
A movement up or down the AD curve is due to changes in the prices of all final goods and services, whereas a movement up and down the demand curve for any individual good is due to a change in the price of that good while all other prices are held constant.
Indicate whether the statement is true or false.