The government can increase aggregate demand to combat unemployment and decrease aggregate demand to combat inflation
Indicate whether the statement is true or false
T
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Which economist created the theory of creative destruction?
A. William Nordhaus B. Joseph Schumpeter C. Adam Smith D. Milton Friedman
Refer to Table 16.1. Which of the following statements is correct?
A) There are potential gains from trade if: (1 ) Mexico specializes in the production of tomatoes, (2 ) Guatemala specializes in the production of beer, and (3 ) Mexico trades tomatoes to Guatemala for beer. B) There are potential gains from trade if: (1 ) Mexico specializes in the production of beer, (2 ) Guatemala specializes in the production of tomatoes, and (3 ) Mexico trades beer to Guatemala for tomatoes. C) There are no potential gains from trade because Mexico has an absolute advantage in the production of beer and tomatoes. D) There are no potential gains from trade because Guatemala has an absolute advantage in the production of beer and tomatoes.
When examining the financial status of households, wealth is
A) synonymous with income. B) a flow variable whereas income is a stock variable. C) a stock variable and includes both tangible assets and human capital. D) not as important as income because wealth does not change over time.
Refer to the graph shown. The elasticity of demand is closest to 1 on line segment:
A. BC. B. CD. C. AB. D. The elasticity is not close to 1 on any of these line segments.