Suppose that a mixed open economy is producing at its equilibrium income and that net exports are zero. If at the equilibrium income the public sector's budget shows a surplus:

What does the average product of labor equal?

What will be an ideal response?

An important problem with the gold standard was that

A) it was too complicated and restricted business activity. B) a country did not have control of its domestic monetary policy. C) exchange rates tended to fluctuate a great deal, making it difficult for businesses to make long-run plans. D) one country could easily manipulate the system to its advantage and the disadvantage of other countries.