If the government were to increase its spending, it would expect:
A. aggregate demand to shift to the right.
B. aggregate demand to shift to the left.
C. aggregate supply to shift to the right.
D. aggregate supply to shift to the left.
A. aggregate demand to shift to the right.
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The International Maritime Bureau said the waters off Somalia are the world's most dangerous, accounting for nearly a third reported pirate attacks worldwide. Suppose all boats are insured to $100,000 and pay a premium of $15,000 each
Suppose 10 out of 100 boats are attacked by pirates and these 10 file claims with their insurance. Has the insurance company earned an economic profit? A) Yes, they earned an economic profit of $500,000. B) Yes, they earned an economic profit of $50,000. C) No, they sustained an economic loss of $85,000. D) No, they broke even.
In the absence of well-defined property rights, we would likely find
A) people with more incentives to take risks. B) people with less incentives to take risks. C) higher economic growth rates. D) increases in investment activity.
If a major league baseball player would be willing to work for $500,000 per year and is currently being paid $1,200,000 per year, the opportunity cost of his decision to play baseball is
A) $500,000. B) $1,200,000. C) $1,700,000. D) $700,000.
If an economic model includes an assumption that there are only two nations in the world, this would be an example of
a. a critical assumption b. an implicit assumption c. a simplifying assumption d. a concrete assumption e. a detail assumption