When government spending is less than the tax revenues during a specific time period, this is known as a A) government budget deficit. B) government budget surplus. C) balanced budget. D) public debt. ANSWER B
Date: September 2nd, 2020
A government budget surplus occurs during a budget year when A) tax revenues = government spending. B) tax revenues + government spending = personal income. C) tax revenues > government spending. D) tax revenues < government spending. ANSWER C
Date: September 2nd, 2020
The credit demand curve is the schedule that reports the relationship between the quantity of credit demanded and ________ in an economy, assuming all else equal. A) the average tax rate B) the annual inflation rate C) the nominal rate of interest D) the real rate of interest ANSWER D
Date: September 2nd, 2020
Other things being equal, appreciation of the dollar A) increases aggregate demand in the United States, and may decrease aggregate supply by reducing the prices of imported resources. B) increases aggregate demand in the United States, and may increase aggregate supply by reducing the prices of imported resources. C) decreases aggregate demand in the United […]
Date: September 2nd, 2020
When interest rates rise, the transactions demand for money usually A) decreases. B) increases. C) decreases initially and then increases to the original position. D) does not change. ANSWER A
Date: September 2nd, 2020
For the U.S. economy, on an average: A) growth resulting from technology is greater than the growth resulting from human capital. B) growth resulting from technology is smaller than the growth resulting from physical capital. C) growth resulting from technology equal to the growth resulting from physical capital. D) growth resulting from technology equal to […]
Date: September 2nd, 2020
Explain how savings equals investment in a closed capitalist economy? What will be an ideal response? ANSWER The national income identity is given by Y = C + I + G + NX, where, C is the consumption expenditure, I is the investment expenditure, G is the Government Spending, and NX is the net […]
Date: September 2nd, 2020
If the government has a spending flow that exceeds the revenues it collects, the government will run a ________ that year. A) surplus B) deficit C) debt D) debt and a deficit ANSWER B
Date: September 2nd, 2020
Which of the following statements is correct? I. A drop in the foreign exchange value of the dollar would decrease aggregate demand II. A decrease in the amount of money in circulation would increase aggregate demand A) I only B) II only C) Both I and II D) Neither I nor II ANSWER D
Date: September 2nd, 2020
If the annual inflation rate in an economy is positive, the purchasing power of a dollar kept in a bank: A) will decrease over time. B) will remain the same over time. C) will increase over time. D) can increase or decrease depending on the economic growth rate. ANSWER A
Date: September 2nd, 2020
