Which of the following correctly describes the spending multiplier?
a. The initial change in aggregate expenditure (either consumption, investment, government, or net exports) divided by the change in equilibrium output.
b. An initial increase in aggregate demand divided by the change in equilibrium output.
c. An initial decrease in aggregate demand divided by the change in equilibrium output.
d. The multiple by which real GDP changes for a given initial change in spending.
d
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Which of the following is NOT a normative statement?
A) People buy more of a good or service when its price falls. B) The distribution of income is fair. C) The government ought to provide health care to everyone. D) Corporations should be more socially responsible.
While Medicaid is targeted towards low-income individuals, exact qualifications are determined by _____
a. the Department of Health and Human Services b. state governments c. local governments d. judicial rulings
For a monopsonist, the marginal labor cost is always
a. equal to the wage rate b. less than the wage rate c. greater than the wage rate d. the same as the labor supply e. the same as the labor demand
The adjustment in exchange rate conversions that takes into account differences in the true cost of living across countries is called
A. purchasing power parity. B. currency-adjusted purchasing power. C. raw purchasing power. D. nominal purchasing power.