If U.S. exports are $150 billion and U.S. imports are $100 billion, which of the following is correct?
a. The U.S. has a trade surplus of $100 billion.
b. The U.S. has a trade surplus of $50 billion.
c. The U.S. has a trade deficit of $100 billion.
d. The U.S. has a trade deficit of $50 billion.
b
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If the government could raise taxes on one good, which product should the government increase tax rates in order to raise tax revenue?
a. Cigarettes b. Alcohol c. Sodas d. None of the above
How do critics of discretionary stabilization policy view frequent changes in spending and tax policy?
A. The changes make the economy smoother, although it may not look that way to individual firms. B. The changes make life more difficult and hectic for Congress and the Fed. C. The changes smooth out the business cycle, making planning easier. D. The changes cause more instability in the economy and make planning more difficult.
Figure 14-1
In , an unanticipated shift to a more expansionary monetary policy will shift
a.
AD to the right and temporarily increase real GDP.
b.
AD to the left and temporarily reduce real GDP.
c.
AD to the right and SRAS to the left and lead to higher prices (inflation).
d.
both AD and SRAS to the right and lead to an increase in real GDP.
Using Figure 1 above, if the aggregate demand curve shifts from AD3 to AD2 the result in the long run would be:
A. P1 and Y2. B. P2 and Y1. C. P3 and Y1. D. P3 and Y2.