If the government ran a major budget deficit, and there was no noticeable effect on the level of GDP, this could be taken as evidence of
a. Laffer curve effect.
b. structural deficit.
c. crowding-out.
d. monetary policy ineffectiveness.
C
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Assume wages paid by a firm to its workers decrease. What will be the reaction of consumers as the market moves to its new equilibrium?
A) Quantity demanded will decrease. B) Quantity demanded will increase. C) The demand curve will shift to the left. D) There will be no reaction by consumers, since input prices determine supply, not demand.
The difference between the interest income or receipts earned on investments in the rest of the world by the residents of a given country and the payments to foreigners on investments they have made in the given country is called:
A) unilateral transfers. B) bilateral transfers. C) net investment income. D) gross investment income.