Consumption expenditures do not include household purchases of
A) medical care.
B) education.
C) new houses.
D) durable goods.
Answer: C
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When economists say goods are scarce, they mean
a. consumers are too poor to afford the goods and services available. b. consumers are unwilling to buy goods unless they have very low prices. c. goods are generally freely available from nature in most countries. d. the desire for goods and services exceeds our ability to produce them with the limited resources available.
An expansionary monetary policy is most likely to increase real output
a. when the economy is operating at less than full-employment capacity. b. when the economy is at full employment. c. when actual output is beyond the economy's long-run capacity. d. when the inflationary side effects are fully anticipated by decision makers.