The classicals believed that when savings exceeds investment.
A. demand is reduced and the economy will go into a recession.
B. the interest rate will decline and equate savings and investment.
C. an increase in supply will encourage higher investment spending.
D. if savings is greater than investment unemployment would reduce savings.
B. the interest rate will decline and equate savings and investment.
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The Keynesian revolution was based on the assumption of price and wage ________ and thus the need for an activist ________ policy
A) flexibility, monetary B) flexibility, fiscal C) stickiness, monetary D) stickiness, fiscal
National income is income ________ the factors of production.
A. earned by B. invested in C. paid by D. households owe to
According to ________, an efficient mix of public goods is produced when local land/housing prices and taxes reflect consumer preferences.
A. Samuelson's theory B. the Coase theorem C. the Theory of Public Choice D. the Tiebout hypothesis
Which country is the United States' largest trading partner in terms of volume of trade?
A. Mexico B. Japan C. China D. Canada