The problem typically during a recession is not that there is too little money, but too little spending. If the problem was too little money, what would be its cause? If the problem was too little spending, what could be its cause?
What will be an ideal response?
Too little money would be caused by too small of a money supply by the Federal Reserve. Too little spending could be caused by a variety of reasons such as a decrease in consumption spending by households because they become pessimistic about the future, a decrease in investment spending by firms because they lower their estimates of the future profitability of new factories and machinery, or a decrease in U.S. exports because a major trading partner is in a recession.
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The distinction between a normal and an inferior good is
A. when income increases, demand for a normal good decreases while demand for an inferior good increases B. normal goods are used for the same purposes while inferior goods are used together C. when income increases, demand for a normal good increases while demand for an inferior good falls D. normal goods are used together while inferior good are used for the same purposes
What is a natural oligopoly? How does it arise? Give an example
What will be an ideal response?