The consumption function is the relationship between ________, other things remaining the same
A) consumption expenditure and net taxes
B) net taxes and disposable income
C) consumption expenditure and the price level
D) consumption expenditure and disposable income
E) consumption expenditure and saving
D
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Which of the following statements is TRUE?
a. The HeckscherOhlin model offers a reasonable explanation of the pattern of trade and the gains from trade. b. The HeckscherOhlin trade model does not offer an explanation of the pattern of trade. c. The HeckscherOhlin trade model does not offer an explanation of the gains from trade. d. The Riparian trade model (with labor as the only input) offers a better explanation of the pattern of trade and the gains from trade than the HeckscherOhlin model.
Based on the conventional view of fiscal policy and potential GDP in the long run, explain what happens to each of the following if the government runs a budget deficit:
a. the supply of loanable funds to the private sector b. long-term real interest rates c. the capital stock d. the investment rate e. potential GDP