The portion of the aggregate supply curve that is a positive function of the general price level represents excess capacity and unemployed resources
a. True
b. False
Indicate whether the statement is true or false
False
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According to the traditional Keynesian analysis, if the government increases spending by $10 million, then
A) consumption will increase, and so total expenditures will increase by more than $10 million. B) consumption will decrease, and so total expenditures will increase by less than the $10 million. C) consumption will remain the same, and so total expenditures will increase by exactly $10 million. D) consumption will increase or decrease, and so total expenditures will increase or decrease depending on the change in consumption.
Your favorite clothing website is offering a new shipping promotion: you can pay a $24 membership fee and receive free shipping for 12 months, or you can continue to receive free shipping as long as you spend at least $50 with every order. Otherwise you will have to pay $6 per shipment. You think $24 sounds like a good deal, but you do not want to make the mistake of being overconfident. Explain how you would make your decision.
What will be an ideal response?
The process of making investments toward fixed assets, both tangible and intangible, is known as
a. capital budgeting b. capital spending c. capital d. net spending e. none of these
Which of the following is the government most likely to discourage because of the existence of externalities?
A. Thermal pollution from a power plant that improves fishing downstream. B. All goods and services produced by monopolies. C. Foods that taste good. D. Cars that create an excessive amount of exhaust fumes.