If demand is highly elastic and supply shifts to the right:
A. price will rise significantly as will quantity.
B. price and quantity will hardly change at all.
C. price will hardly change at all; quantity will rise significantly.
D. price will fall significantly; quantity hardly changes at all.
Answer: C
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When taxes are decreased, disposable income increases even though GDP is unchanged
a. True b. False Indicate whether the statement is true or false
Assume the government reduces government spending. What is the first round effect on the components of the balance of payments (assume low international capital mobility and fixed exchange rates; also assume that before the government action all the components were 0)? a. Current international transactions balance and reserves account become positive; net nonreserve international
borrowing/lending balance becomes negative. b. Current international transactions balance becomes positive; net nonreserve international borrowing/lending balance and reserves account become negative. c. Net nonreserve international borrowing/lending balance becomes positive; current international transactions balance and reserves account becomes negative. d. Net nonreserve international borrowing/lending balance and reserves account become positive; current international transactions balance becomes negative. e. Reserves account becomes positive; current international transactions balance and net nonreserve international borrowing/lending balance become negative.
If the tax revenue of the federal government exceeds spending, then the government necessarily
A. runs a budget deficit. B. runs a budget surplus. C. runs a national debt. D. will increase taxes.
The early goldsmiths issued money in the form of
A. coins made from gold in their safes. B. receipts for the acceptance of gold deposits. C. gold fragments left over from the production of jewelry. D. fully backed gold certificates.