Which of the following would be included in aggregate demand?
a) government's tax collections
b) the quantity of services that firms sell
c) firms' purchases of newly produced machinery
d) the quantity of goods that firms produce
Ans: c) firms' purchases of newly produced machinery
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When a country exports a good because the world price is higher than the no-trade domestic price, domestic purchases of the good ________ and domestic production of the good ________
A) do not change; increases B) increase; increases C) decrease; increases D) decrease; decreases E) increase; decreases
Agricultural price supports in the United States
A) harm U.S. consumers, U.S. taxpayers, and foreign farmers and creates a deadweight loss. B) benefit U.S. taxpayers, U.S. farmers, and U.S. consumers. C) create gains to U.S. farmers that are at least as large as losses to U.S. consumers. D) decrease the deadweight loss and improve market efficiency. E) None of the above answers is correct.