The Golden Rule capital-labor ratio is the level of the capital-labor ratio that, in the steady state,
A. maximizes consumption per worker.
B. maximizes capital per worker.
C. maximizes output per worker.
D. maximizes investment per worker.
Answer: A
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The fact that borrowers sometimes default on their loans by declaring bankruptcy is directly related to the characteristic of a bond called
a. credit risk. b. interest risk. c. term risk. d. private risk.
Refer to the information provided in Table 23.9 below to answer the question(s) that follow. Table 23.9
Refer to Table 23.9. At an aggregate output level of $400 billion, aggregate saving
A. equals -$20 billion. B. equals $0. C. equals $20 billion. D. cannot be determined from this information.
Explain what type of unemployment changes with the business cycle and how it changes
What will be an ideal response?
Refer to Figure 27-7. Given that the economy has moved from A to B in the graph above, which of the following would be the appropriate fiscal policy to achieve potential GDP?
A) increase government spending B) contractionary fiscal policy C) increase taxes D) decrease interest rates