Gross domestic product (GDP) includes:
a. used goods sold in the current time period.
b. only final goods and services.
c. foreign goods as well as domestically produced goods.
d. intermediate as well as final goods.
b
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Refer to Figure 14.3. Suppose the economy is initially at long-run equilibrium and the economy experiences a demand shock such as a stock market crash
Other things equal, following the effect of the stock market crash, the economy will ultimately end up at a new long-run equilibrium ________ the initial long-run equilibrium. A) that is the same as B) with a higher real GDP and a higher inflation rate than C) with a higher real GDP than, and the same inflation rate as D) with a higher inflation rate than, and the same real GDP as
Paul Samuelson is immensely famous among economists for having established the supply-side school of economics
Indicate whether the statement is true or false
Welfare economics explains which of the following in the market for televisions?
a. The government sets the price of televisions; firms respond to the price by producing a specific level of output. b. The government sets the quantity of televisions; firms respond to the quantity by charging a specific price. c. The market equilibrium price for televisions maximizes the total welfare of television buyers and sellers. d. The market equilibrium price for televisions maximizes consumer welfare and minimizes producer profit.
One problem with the ripple effect from the Fed's monetary policy is
A) the fact that the monetary policy transmission process is long and drawn out. B) that changing the Federal funds target rate seldom has an effect on the markets for reserves and loanable funds. C) the frequent misalignment of the spread between the Federal funds rate and the Federal funds rate target. D) that the Fed's policy sometimes has a large impact on potential GDP as well as its usual impact on aggregate demand. E) the tight relationship between that the Federal funds rate has to aggregate spending.