Provided that firms have sufficient capital and labor to support an output increase, monetary and fiscal policy are likely to be the most effective when
A. prices and inventory stocks are both high.
B. output is low and inventory stocks are low.
C. output is low and inventory stocks are high.
D. output and inventory stocks are both high.
Answer: B
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Consider two economies: A and B that are completely similar, except their savings rate. The savings rate in economy A is greater than the savings rate in economy B. Which of the following statements is true?
A) Capital accumulation will be faster in economy B in comparison to economy A. B) Capital accumulation will be faster in economy A in comparison to economy B. C) Rate of capital accumulation will be the same in both economies. D) Growth rate in country B is likely to be higher than the growth rate of country A in the long-run.
If more firms enter the telecommunications industry, we can expect the equilibrium price of telecom services to decrease and the equilibrium number of services to increase
a. True b. False Indicate whether the statement is true or false