Answer the following statements true (T) or false (F)
1) In the Great Recession of 2007-2009, consumption C and investment I g fell while government G expanded.
2) In the Great Recession of 2007-2009, the Federal government enacted a "stimulus package" that was intended to bring inflation down.
3) When the Federal government provides tax rebate checks to taxpayers, as it did in 2008, the
intent is to push the aggregate expenditures schedule in the economy upwards.
4) In the Great Recession of 2007-2009, the sector of the economy that decreased the most was G.
1) T
2) F
3) T
4) F
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For this question, assume that the economy is initially operating at the natural level of output. An increase in unemployment benefits will cause
A) an increase in the real wage in the medium run. B) a reduction in the real wage in the medium run. C) no change in the real wage in the medium run. D) ambiguous effects on the real wage in the medium run.
Gross domestic product (GDP) does not include:
a. used goods sold in the current time period. b. foreign produced goods. c. intermediate as well as final goods. d. None of these would be included.