If the value of a nation's merchandise imports exceeds merchandise exports, the nation is running a
What will be an ideal response?
merchandise trade deficit.
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A government budget surplus is
A) a situation in which the supply of goods in the economy is greater than the demand for goods. B) a situation in which the amount spent by the government is greater than the amount collected in taxes. C) the public debt. D) an excess of revenues over government spending.
A nation practicing mercantilism aims to
a. keep the government out of the economy. b. establish an excess of exports over imports. c. balance imports with exports. d. replace gold and silver with paper money. e. reduce the size of the military sector.
Which of the following situations would cause a period of stagflation at a later point in time?
a. a recessionary gap b. a reduction in investment spending c. an increase in technological development d. an inflationary gap
Suppose that a $30 billion increase in government spending increases Real GDP by $150 billion, and that a $10 billion tax reduction increases Real GDP by $40 billion. In this situation, the tax multiplier is _______________ the government spending multiplier
A) less than B) greater than C) equal to D) none of the above