Describe the difference between business-cycle macroeconomics and economic-growth macroeconomics
Business-cycle macroeconomics involves changes in Real GDP (up and down) around a fixed LRAS curve. Economic-growth macroeconomics deals with increases in Real GDP resulting from a rightward-shifting LRAS curve. The rightward shifts in the LRAS represent economic growth.
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If consumption = $2,000, investment = $600, government purchases = $500, net exports = ?$40, transfer payments = $340, then _____
a. GDP = $2,720 b. GDP = $3,060 c. GDP = $3,140 d. GDP = $3,400 e. GDP = $3,340
The market system fails to provide the efficient output of public goods because: a. people place no value on public goods
b. private firms cannot restrict the benefits from those goods to consumers who are willing to pay for them. c. public enterprises can produce those goods at lower cost than private firms. d. public goods create widespread spillover costs.