A large negative GDP gap implies:
A. an excess of imports over exports.
B. a low rate of unemployment.
C. a high rate of unemployment.
D. a sharply rising price level.
C. a high rate of unemployment.
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Which of the following is most likely to help the residents of a nation produce more goods and services and achieve higher income levels?
a. higher tax rates b. a higher rate of investment c. a smaller trade sector d. greater use of taxation to transfer income from the rich to the poor
Which product will have the most elastic demand curve?
A. Thread B. Heating oil C. A new automobile D. Cigarettes
If potential output equals $8 billion and actual output equals $9 billion, then this economy has a(n):
A. trade deficit. B. recessionary gap. C. expansionary gap. D. budget deficit.
Government laws and policies need to be uniformly enforced. But this leads to all of the following problems, except:
A. Inflexibility B. Massive paperwork C. Excessively detailed rules D. Haphazard application