Suppose the economy is initially experiencing a short-run recessionary gap. An increase in the size of the budget deficit will
A) increase the size of the recessionary gap.
B) reduce the size of the recessionary gap.
C) lead to an increase in prices with no increase in real GDP.
D) lead to a decrease in prices with an increase in real GDP.
B
Economics
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A change in supply cannot be caused by a change in:
a. resource prices. b. technology. c. prices of other goods. d. the price of the good itself. e. the number of suppliers.
Economics
The classical model does a poor job of explaining the __________ because it assumes that the __________ always clears
a. long run; labor market. b. long run; financial market. c. short run; labor market. d. short run; financial market. e. short run; housing market.
Economics