During recessions, unemployment ________ while the budget deficit as a percentage of GDP ________
A) increases; increases B) decreases; increases
C) decreases; decreases D) increases; decreases
A
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In the long run, a perfectly competitive firm can make an economic profit because its marginal cost equals its average total cost
Indicate whether the statement is true or false
During recent Global Economic Crises, consumers' wealth in the U.S. declined as a result of all of the following EXCEPT
A) the stock market crash. B) pricking of the housing bubble. C) increased household borrowing. D) aggressive fiscal policy.
An increase in the U.S. demand for foreign exchange will
a. decrease the price of foreign exchange b. decrease the value of the U.S. dollar c. increase the value of the U.S. dollar d. make foreign goods less expensive in U.S. dollars e. make U.S. goods more expensive in foreign exchange
The simple Keynesian model assumes that
A. gross private domestic investment exceeds net investment by the capital consumption allowance. B. aggregate demand will always equal aggregate supply. C. there will never be any excess capacity in the short run. D. prices, especially the price of wages, are "sticky downward."