Answer the following statement(s) true (T) or false (F)
1. The formula for calculating aggregate demand is the same formula used to calculate GDP using the expenditure approach.
2. The aggregate demand and aggregate supply model is a closed economy model because it includes international trade effects.
3. An inverse relationship exists between the quantity of real GDP demanded and the overall price level.
4. The aggregate demand curve is downward sloping.
5. Purchasers in the economy demand more real output when the price level rises.
1. True
2. False
3. True
4. True
5. False
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Explain how an import quota might be more inefficient than an import tariff that has the same impact on prices.
What will be an ideal response?
Which of the following barometric indicators would be the most helpful for forecasting future sales for an industry?
a. lagging economic indicators. b. leading economic indicators. c. coincident economic indicators. d. wishful thinking e. none of the above
Which of the following is a commonly-cited benefit of advertising?
a. Advertising can be a signal of the quality of a product. b. Advertising impedes competition. c. Advertising reduces the deadweight loss associated with monopolistic competition. d. Advertising encourages free entry, which increases profits.
National health care programs are not as effective as they could be because:
A. patients are not receptive to utilization of modern medicine in most nations. B. many doctors in clinics do not have sufficient knowledge to properly diagnose patients. C. traditional Western medicine is largely untrusted in most parts of the developing world. D. health care providers tend to have a high absentee rate.