The value of the multiplier is likely to fall if there is a decrease in
A. total spending.
B. income.
C. the marginal propensity to consume.
D. consumption.
Answer: C
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The amount of time it takes Congress to debate the size of a tax cut is known as the
A) recognition time lag. B) action time lag. C) effect time lag. D) Ricardian-equivalence time lag.
When the flow of money from the foreign countries to the domestic firms equals the flow of money from the home country to the foreign firms, _____
a. a trade surplus exists b. an equal amount of agricultural and manufactured products are exported c. a trade deficit exists d. an equal amount of goods and services are imported e. the value of net exports is zero
Which of the following would NOT be expected to increase labor productivity?
A. Technological advance B. The acquisition of more education and training by the labor force C. An increase in the size of the labor force D. The realization of economies of scale
The equation of exchange
A. always balances. B. usually balances. C. sometimes balances. D. never balances.