Based on the figure below. Starting from long-run equilibrium at point C, a decrease in government spending that decreases aggregate demand from AD1 to AD will lead to a short-run equilibrium at__ creating _____gap.
A. B; no output
B. D; an expansionary
C. B; recessionary
D. D; a recessionary
Answer: D
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The main reason why income per capita and income per worker varies across countries is because ________
A) prices vary across countries B) currencies vary across countries C) productivity varies across countries D) interest rates vary across countries
Which of the following is an important difference between police protection and food and explains why one is commonly provided by government while the other is not?
A) Food can easily be withheld from people who don't pay for it. B) Food is not a traditional concern of government. C) Food is too vital to be entrusted to government. D) Food producers form a powerful political lobby. E) Food provided through government would be inefficient.
Which of the following is NOT included in the monetary aggregate M2?
A) currency B) savings bonds C) traveler's checks D) checking deposits
In a monopoly,
A) marginal revenue is greater than price. B) marginal revenue is less than price. C) the demand curve is horizontal. D) marginal revenue and price are equal