Efficiency is the condition in which the economy is producing what people want at the least possible cost.
Answer the following statement true (T) or false (F)
True
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Assume that the expectation of declining housing prices cause households to reduce their demand for new houses and the financing that accompanies it. If the nation has highly mobile international capital markets and a flexible exchange rate system, what happens to the quantity of real loanable funds per time period and real GDP in the context of the Three-Sector-Model?
a. The quantity of real loanable funds per time period and real GDP remain the same. b. The quantity of real loanable funds per time period rises, and real GDP remains the same. c. The quantity of real loanable funds per time period falls, and real GDP falls. d. The quantity of real loanable funds per time period falls, and real GDP rises. e. The quantity of real loanable funds per time period rises, and real GDP falls.
In his book The Other Path, de Soto suggests that countries will grow more quickly if governments limit entrepreneurship.
Answer the following statement true (T) or false (F)
Since World War II, with the exception of the late 1990s, the governments of most developed countries have
a) run budget surpluses b) repaid their national debts c) run budget deficits in times of recession d) kept their budgets balanced e) been net lenders in times of recession
An economy in which output has decreased and prices have decreased would suggest a:
A. decrease in short-run aggregate supply. B. increase in aggregate demand. C. increase in short-run aggregate supply. D. decrease in aggregate demand.