A recessionary gap can be defined as:
A. an economy that is operating above its full-employment capacity.
B. an economy that is operating at full-employment capacity.
C. the amount by which aggregate expenditures exceeds the aggregate expenditures level needed to generate equilibrium real GDP at full employment without inflation
D. the amount by which aggregate expenditures falls short of the level needed to generate equilibrium real GDP at full employment without inflation.
Answer: D
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Deliberately cutting taxes or increasing expenditures to fight an economic downturn is called ________
Fill in the blank(s) with correct word
A recent article suggests that the introduction of the new iPhone 6 increased the demand for iPhone protective cases. The article suggests that these two goods are
A) substitutes and their indifference curves are close to being straight lines. B) complements and their indifference curves are close to being straight lines. C) substitutes and their indifference curves are close to being L shaped. D) complements and their indifference curves are close to being L shaped.