The approach to understanding the determination of real GDP and the price level that emphasizes flexible wages and prices and competitive markets is
A. the Keynesian model.
B. Adam Smith's Law.
C. Murphy's Law.
D. the classical model.
Answer: D
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According to the quantity theory of money, a shortage of money should result in deflation (falling prices) or negative growth (decreasing quantities of output)
Indicate whether the statement is true or false
Suppose that you open your own business and earn an accounting profit of $35,000 per year. When you started your business, you left a job that paid you a $30,000 salary annually
Also, suppose that you invested $70,000 of your own funds to start up your business. If the normal rate of return on capital is 10 percent, your economic profit is A) $5,000. B) -$5,000. C) $2,000. D) -$2,000.
The consumption curve will shift upward if real asset and money holdings
a. increase, if people expect prices to increase, if interest rates decrease, and if taxes decrease b. increase, if people expect prices to increase, if interest rates increase, and if taxes increase c. increase, if people expect prices to increase, if interest rates increase, and if taxes decrease d. decrease, if people expect prices to decrease, if interest rates decrease, and if taxes decrease e. decrease, if people expect prices to increase, if interest rates increase, and if taxes decrease
Suppose the United States subsidizes domestic chicken production and then sells surpluses on the world market at a price below the cost of production
In foreign countries, the argument that would made to restrict chicken trade with the United States would be the A) penalizes lax environmental standards argument. B) saves jobs argument. C) infant-industry argument. D) dumping argument. E) national security argument.