The theory of new Keynesian inflation dynamics suggests that a fall in aggregate demand would
A. immediately raise the price level, followed by a more sluggish decline in real Gross Domestic Product (GDP).
B. immediately reduce the price level, followed by a more sluggish decline in real Gross Domestic Product (GDP).
C. immediately raise real Gross Domestic Product (GDP), followed by a more sluggish increase in the price level.
D. immediately reduce real Gross Domestic Product (GDP), followed by a more sluggish decline in the price level.
Answer: D
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Protection of an infant industry should be withdrawn once that industry:
a. charges the same price as foreign competitors. b. goes public on the stock exchange. c. raises a large amount of sales revenue. d. achieves sufficient size to compete with foreign firms. e. earns enough profit as a result of the subsidies to remain in business.
Other things the same, if a country has a trade deficit and saving rises,
a. net capital outflow rises, so the trade deficit increases. b. net capital outflow rises, so the trade deficit decreases. c. net capital outflow falls, so the trade deficit increases. d. net capital outflow falls, so the trade deficit decreases.
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What will be an ideal response?
Suppose that Bill Toney, a tobacco farmer near Roanoke, Virginia has assets of $50 million and liabilities of $38 million. What is the equity for this tobacco farmer?
A) $50 million B) $88 million C) $6 million D) $12 million