The government of an economy must borrow money from the loanable funds market if the value of:
a. government expenditures is lower than the value of net taxes.
b. government expenditures is higher than the value of net taxes.
c. consumption expenditures is lower than the value of net taxes.
d. investment expenditures is lower than the value of savings.
b
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Unanticipated inflation will insure that
A) homeowners with outstanding mortgage balances are hurt. B) homeowners with outstanding mortgage balances are benefited. C) creditors gain, debtors lose. D) none of the above
For a monopolist that engages in price discrimination, when the price elasticity in market 1 is less (in absolute value) than in market 2, the optimal price in market 1 will exceed the optimal price in market 2
a. true b. false
If Y = C + Ii, C = 100 + .80Y, Ii = 100, the equilibrium level of income is
a. $200 b. $400 c. $600 d. $800 e. $1,000
Industries which receive government protection from trade pressures are likely to exhibit all of the following except
a) high levels of employment b) low levels of productivity c) a high proportion of unskilled workers d) monopoly power e) comparative advantage