The self-correcting property of the economy means that output gaps are eventually eliminated by:

Which of the following summarizes the "incentive problem" with gift-giving that Professor Tabarrok discusses in the video?

A. Gift-giving reduces the incentives for people to rely on market transactions. B. When people choose gifts, they have little incentive to choose carefully. C. When people buy gifts, they have an incentive to overspend to send a signal that they are generous. D. People have little incentive to purchase a gift unless they expect a gift in return.

Assume that the U.S. dollar depreciates against the Japanese yen. What is the impact on aggregate expenditures and income?

A) Both increase. B) Both decrease. C) Aggregate expenditure increases and income decreases. D) Aggregate expenditure decreases and income increases.