If government spending increases, which of the following would be most likely in the short and in the long run? (Both comparisons are with regard to the original price level/output combination.)
a. Short-run increases in the price level, no change in output; long-run increases in output and in the price level
b. Short-run increases in output and in the price level; long-run increase in output, decrease in the price level
c. Short-run decreases in output and in the price level; long-run increase in the price level, no change in output
d. Short-run increases in output and in the price level; long-run increase in the price level, no change in output
e. Short-run decreases in output and in the price level; long-run decreases in output and in the price level
D
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Nominal government purchases were $2226.2 billion in 2008 and rose to $2372.8 billion in 2009. Real government purchases were $1940.6 for 2008 and $1958.0 for 2009, where 2005 was the base year
Calculate the percent change in the chain-weight price index for government purchases (rounded to the nearest percentage point) from 2008 to 2009. A) 2% B) 4% C) 6% D) 8%
A rent control law, where tenants pay below-market rents, is a market restriction that may induce a decrease in the supply of rented apartments
a. True b. False Indicate whether the statement is true or false