Economic growth occurs as a result of all of the following EXCEPT

Government consumption expenditures equal

A) government outlays minus transfer payments. B) government outlays minus net interest payments. C) government purchases minus government investment. D) the government primary deficit plus net interest payments.

Monopolistic competition is characterized by excess capacity because:

A. firms charge a price that is less than marginal cost. B. firms produce at an output level less than the least-cost output. C. the demand for a product is perfectly elastic in this type of industry. D. firms are always profitable in the long run.