If a hurricane were to wipe out the majority of the eastern seaboard in the United States:
A. neither the short-run nor long-run aggregate supply curves would be affected.
B. only the long-run aggregate supply curve would shift left.
C. only the short-run aggregate supply curve would shift left.
D. the long-run and short-run aggregate supply curves would both shift left.
Answer: D
Economics
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Saving is important for economic growth because
A) a higher saving rate will decrease the standard of living in the future. B) a higher saving rate increases investment spending. C) more saving increases consumption immediately. D) a higher saving rate reduces investment spending.
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Assume a closed economy with fixed taxes and the marginal propensity to consume is equal to 0.9. What is the government spending multiplier?
A) 10 B) 9 C) 5 D) 1
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