Assume that the economy is initially at its equilibrium level of GDP. What will happen to the equilibrium level of GDP if planned investment decreases by 20, government spending increases by 30, and taxes increase by 10?
A) GDP will decrease by 60
B) GDP will decrease by 10
C) there will be no change in GDP
D) GDP will increase by 10
D
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Johnny owns a house that would cost $100,000 to replace should it ever be destroyed by fire. There is a 0.1% chance that the house could be destroyed during the course of a year. Johnny's utility function is U = W0.5
How much would fair insurance cost that completely replaces the house if destroyed by fire? Assuming that Johnny has no other wealth, how much would Johnny be willing to pay for such an insurance policy? Why the difference?
Along a segment of the demand curve where the price elasticity of demand is less than 1, a decrease in price:
a. decreases quantity demanded. b. will increase total revenue. c. will decrease total revenue. d. is impossible.
Quality Motors is a Japanese-owned company that produces automobiles; all of its automobiles are produced in American plants. In 2010 Quality Motors produced $30 million worth of automobiles, with $17 million in sales to Americans, $9 million in sales to Canadians, and $4 million worth of automobiles added to Quality Motors' inventory. The transactions just described contribute how much to U.S
GDP for 2010? a. $17 million b. $21 million c. $26 million d. $30 million
"In economics, the short run commonly refers to a period within one year and the long run is a period longer than one year." Do you agree or disagree? Explain your answer
What will be an ideal response?