A public franchise
A) is a corporation that is owned by stockholders.
B) results from ownership of a key raw material.
C) is a government designation that a private firm is the only legal producer of a good or service.
D) is an unregulated monopoly necessary for the public good.
Answer: C
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Which of the following could explain why there is an increase in potential GDP but the equilibrium level of GDP does not rise?
A) SRAS shifted to the right by more than LRAS. B) AD shifted to the right by more than SRAS. C) SRAS and AD do not shift. D) AD shifted to the right by less than SRAS.
On a graph showing the influence of automatic stabilizers on the economy, government expenditures on transfer payments and real GDP have a(n):
A. direct relationship as shown by an upward-sloping line. B. direct relationship as shown by a downward-sloping line. C. inverse relationship as shown by an upward-sloping line. D. inverse relationship as shown by a downward-sloping line.