Which of the following restrictions implies that investment exceeds private saving for a closed economy?
a. The economy has no government.
b. The economy's government is running a budget deficit.
c. The economy's government is running a budget surplus.
d. No restriction is necessary; investment and private saving are equal for all closed economies.
c
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The figure above shows the market for polio vaccination in Pakistan. Polio vaccination confers an external benefit because one person's vaccination makes it less likely that other people will catch polio
a. If the market is competitive and left unregulated, how many doses of vaccine will be administered? b. If the Melinda and Bill Gates Foundation underwrites the cost of the vaccine by paying for a large fraction of the preparation and delivery cost, what will happen to the number of doses administered? Why?
The interest-rate effect
a. depends on the idea that increases in interest rates increase the quantity of money demanded. b. depends on the idea that increases in interest rates increase the quantity of money supplied. c. is the most important reason, in the case of the United States, for the downward slope of the aggregate-demand curve. d. is the least important reason, in the case of the United States, for the downward slope of the aggregate-demand curve.
If two products are homogeneous, then they
A. Are identical. B. Differ from each other. C. Are similar to each other. D. Must be used together.
The tax multiplier is smaller in absolute value than the government purchases multiplier because some portion of the
A) decrease in taxes will be saved by households and not spent, and some portion will be spent on imported goods. B) decrease in taxes will be saved by households and not spent, and some portion will be spent on consumer durable goods. C) increase in government purchases will be saved by households and not spent, and some portion will be spent on imported goods. D) increase in government purchases will be saved by households and not spent, and some portion will be spent on consumer durable goods.