In order to encourage domestic saving, it is necessary to have:
a. a laissez faire economy.
b. a balanced fiscal budget.
c. a large number of government subsidies.
d. a stable system of property rights.
e. a highly developed banking system.
d
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Starting from long-run equilibrium, a large increase in government purchases will result in a(n) ________ gap in the short-run and ________ inflation and ________ output in the long-run.
A. expansionary; higher; potential B. recessionary; higher; potential C. recessionary; lower; lower D. expansionary; higher; higher
Is optimization analysis positive or normative, or both? Explain your answer
What will be an ideal response?
A monopsony is characterized as a market which has:
A. many buyers and one seller. B. many buyers and many sellers. C. one buyer and one seller. D. one buyer and many sellers.
The arithmetic difference between the nominal rate of interest and the expected rate of inflation is the
A. expected interest rate. B. real interest rate. C. implied interest rate. D. contractual interest rate.