During a recession, unemployment rises and total output of the economy rises.
Answer the following statement true (T) or false (F)
False
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A short-run change in ________ is referred to as a business cycle
A) the currency exchange rate B) the expenditure incurred by the government C) the aggregate price level D) the growth rate of output
If Ap is total autonomous planned spending, c is the marginal propensity to consume, s is the marginal propensity to save, and Y is the equilibrium income level, then
A) Ap/Y. B) Y = Ap/s. C) sY. D) cAp.
In the income-expenditure model, if autonomous investment decreases by $10 billion, _____
a. the aggregate expenditure line shifts upward by $10 billion b. planned saving increases by $10 billion c. the aggregate expenditure line shifts downward by $10 billion d. planned saving decreases by $10 billion e. the equilibrium level of real GDP demanded increases by $10 billion
Economists believed that the U.S. economy had a (n) ____ in 2006 and 2007
a. mild recession b. small recessionary gap c. small inflationary gap d. deflationary gap