The leakage and injections approach implies that deficit spending by the government must be financed by
A) private investment less private savings plus net exports.
B) private saving less private investment plus net exports.
C) the trade deficit must always offset the government deficit.
D) B and C.
A
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The natural rate of unemployment is defined as the rate of unemployment that
A) exists only during periods of recession or depression in the economy. B) exists due to welfare and unemployment benefits that reduce potential workers' incentives to find work. C) prevails in long-run macroeconomic equilibrium, when all workers and employers have fully adjusted to any changes in the economy. D) prevails in the short-run macroeconomic equilibrium, before workers and employers have had a chance to adjust to an economic shock.
Investment is financed by which of the following?
I. Government spending II. National saving III. Borrowing from the rest of the world A) I, II, and III B) I and II only C) I and III only D) II and III only
Even though household have wide-ranging preferences, discuss some of the things that all households have in common including their constraints
What will be an ideal response?
Refer to the information provided in Figure 2.1 below for the economy of Macroland to answer the question(s) that follow.
Figure 2.1Refer to Figure 2.1. If Macroland's economy is at Point A, it could produce more consumer goods
A. only with technological improvements. B. only with additional resources. C. without sacrificing any capital goods. D. only by sacrificing some capital goods.