Historical note: When the railroad displaced water transport as the principal means of long-distance transportation, it sparked massive investment spending not only in the railroad industry, but in secondary industries such as
a. mining, automobiles, and genetic engineering
b. steel, computers, and videocassette recorders
c. lumber, construction, and aviation
d. construction, steel, housing, and semiconductors
e. mining, steel, lumber, and construction
E
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The difference between gross investment and net investment is
A) the capital stock. B) depreciation. C) the real interest rate. D) equal to saving.
In the period 1960–95,
(a) the relations between capital and labor (owners and workers) continued to be as hostile and violent as they were in the 1930s and earlier. (b) the relations between capital and labor (owners and workers) continued to be cooperative and peaceful, as they had been throughout U.S. history. (c) an accord was struck which involved more cooperative relations between capital and labor and encouraged high rates of productivity in industry. (d) the federal government intervened with a strong hand to ensure that labor and capital worked together cooperatively.
Use the concept of supply and demand to explain why an increase in Medicare subsidies can lead to an increase in health care spending by the government
What will be an ideal response?
During the second half of 2008 the monetary base was growing far more rapidly than the money supply because
a. banks were using most of their excess reserves to extend loans and make investments. b. the Fed quickly shifted from expansionary monetary policy to restrictive monetary policy. c. banks were using their excess reserves to make foreign investments. d. banks were maintaining huge excess reserves.