The largest component of total expenditures in the United States is:
A. net exports.
B. government purchases.
C. consumption.
D. gross investment.
C. consumption.
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Refer to Figure 4.1, which shows Molly's and Ryan's individual demand curves for compact discs per month. Assuming Molly and Ryan are the only consumers in the market, if the market quantity demanded is 5, the price must be
A) $3. B) $6. C) $9. D) $12.
An important reason why economies at an early stage of development tend to operate inefficiently is
A) they tend to be dominated by the agricultural sector, where productivity is usually low. B) they tend to have authoritarian governments that stifle innovation. C) they tend to be plagued by superstitious beliefs that stifle innovation. D) the high transactions costs associated with barter.
When Social Security checks were first issued the nominal amount:
A. regularly increased by 5 % every 3 months. B. regularly increased by 10 % every 3 years. C. stayed 3% above the poverty level for all recipients. D. stayed the same for the life of the payments.
If a state government reduces property taxes for residents at the same time that it increases the state income tax, what will happen to the expenditures schedule of the residents of this state?
A. It shifts upward. B. It shifts downward. C. It becomes less steep. D. It becomes steeper. E. It does not change.