Refer to the information provided in Figure 24.4 below to answer the question(s) that follow.
Figure 24.4Refer to Figure 24.4. What is the value of the expenditure multiplier?
A. 5
B. 8
C. 10
D. 20
Answer: A
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Comparing the short-run Phillips curve and the long-run Phillips curve, we see that there is
A) no relationship between the two curves. B) no tradeoff in either curve. C) a tradeoff in both curves. D) only a long-run tradeoff between inflation and unemployment but not a short-run tradeoff. E) only a short-run tradeoff between inflation and unemployment but not a long-run tradeoff.
For monetarists, the sole source of fluctuations in aggregate demand is ________
A) government spending and tax rates B) the velocity of money C) the supply of money D) international trade variables, i.e. exports and imports
According to the permanent income hypothesis, when income rises above the permanent income level, the household saves at a lower rate than the long-run MPS
a. True b. False Indicate whether the statement is true or false
The law of increasing costs is based on each of the following, except
A. the law of scarcity. B. the law of diminishing returns. C. diseconomies of scale. D. factor suitability.