Effective collusion generally is more difficult as the number of oligopolistic firms involved increases

To close a recessionary gap using fiscal policy, the government can:

a. increase government spending by the size of the gap. b. decrease government spending by the size of the gap. c. increase government spending by more than the size of the gap. d. increase government spending by less than the size of the gap. e. decrease government spending by more than the size of the gap.

Assume that between 1999 and 2009 nominal GDP increased from $7 trillion to $12 trillion and that the GDP deflator rose from 100 to 150 . Which of the following expresses GDP for 2009 in terms of 1999 prices?

a. $7.5 trillion b. $8.0 trillion c. $9.0 trillion d. $18.0 trillion