Use the following figure to answer the next question. 
If box E represents government, box C businesses, and box A households, then flows (11) and (12) would represent
A. net taxes.
B. government expenditures.
C. resources.
D. goods and services.
Answer: A
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Monetarists blame rising government deficits for rising inflation
A) because deficits shift aggregate demand to the right. B) so long as the aggregate supply curve is vertical. C) when financing these deficits involves money creation. D) because the deficits increase the demand for money and thus interest rates.
A market is said to "clear" when
A) sellers give up selling their goods because they can't find any buyers. B) buyers and sellers are able to buy and sell as much as they want at the market price. C) the government decides to shut it down. D) sellers run out of goods to sell.
The estimate of potential GDP would decrease if
a. the rate of capital depreciation increased. b. the labor force decreased. c. the price level grew. d. All of the above would increase potential GDP.
The present discounted value of $60,000 to be received at the end of three years when the interest rate is 10 percent is closest to
A. $79,860. B. $49,587. C. $45,079. D. $60,000.