A recessionary gap is the amount by which aggregate expenditures ____ the amount required to achieve full-employment equilibrium GDP.
A. exceed
B. equal
C. fall short of
D. are greater than
Answer: C
You might also like to view...
If the pollution havens hypothesis is true, we should expect world pollution to decline as a result of international trade and globalization
Indicate whether the statement is true or false
The reason economists assume that firms try to maximize economic profit is
a. over time, firms that don't earn profits will have difficulty securing financing to survive b. firms in the real world always maximize profit c. profit is easier to calculate than revenues d. if a firm fails to earn a profit in its first year, it will go out of business e. profit maximization is easier for firms than revenue maximization
If the natural unemployment rate is 5.5 percent, then the economy is in a recessionary gap when the actual unemployment rate is
A) greater than 5.5 percent. B) between 0 and 5.5 percent. C) 0 percent. D) 5.5 percent.
There are 10,000 families in a neighborhood that are affected by noise pollution from a local factory. The noise could be reduced if the company spent $5,000 on technological improvements. The company agrees to make these improvements if the affected families contribute the $5,000. Since there are so many families, they fail to come to a resolution to which they will all agree. This outcome is an example of the
A. drop-in-the-bucket problem. B. collective action problem (that arises when there are too many parties involved). C. Coase theorem. D. free-rider problem.