Comparing the simple Keynesian model with the IS-LM model, in the IS-LM model
a. the government spending multiplier is larger.
b. the balanced budget multiplier is larger.
c. the tax multiplier is smaller.
d. there is no difference between any of the multipliers.Figure 7-2
C
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A country with a real GDP per person similar to real GDP per person in the United States but with limited political freedom is generally considered to have
A) a lower standard of living than the United States. B) a larger Human Development Index because the other country still needs to develop more political freedom. C) the same standard of living as the United States. D) an understated GDP. E) an overstated nominal GDP.
If the price of a hot dog is $2 and the price of a hamburger is $4, then the
A) relative price of a hot dog is 1/2 of a hamburger per hot dog. B) money price of a hot dog is 2 hamburgers per hot dog. C) relative price of a hamburger is 1/2 of a hot dog per hamburger. D) money price of a hamburger is 2 hot dogs per hamburger.
The tendency of opportunity cost to increase as production increases
a. is an example of theory that has not been proven by facts. b. is a general principle, but not a universal fact. c. is a universal fact, with no known exceptions. d. rarely holds in reality, but is a useful theory. e. cannot be tested with standard economic tools.
Which of the following results in the greatest present value if the interest rate is 10%?
a. A perpetuity that pays $10 per year. b. One hundred dollars tomorrow. c. A payment of $111 at the end of this year. d. One hundred dollars today.