One of the practical issues in the choice of government spending or taxes to change aggregate demand is how large a
a. change in demand we want.
b. trade deficit we want.
c. budget deficit we want.
d. government sector we want.
d
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Which of the following conditions do NOT exist in long-run equilibrium?
a. Domestic nominal interest rates are such that the supply of real balances is equal to demand. b. The domestic real return is equal to the foreign real return through the equilibrium exchange rate. c. There are no price level or exchange rate changes and therefore the expected future exchange rate is equal to the actual exchange rate. d. Domestic nominal interest rates are such that the supply of real balances is greater than demand.
Which of the following is true? In the above figure, if the market is
A) a monopoly, output will be Q1 and price will be P3. B) a monopoly, output will be Q3 and price will be P3. C) perfect competition, output will be Q2 and price will be P2. D) perfect competition, output will be Q1 and price will be P1. E) perfect competition, output will be Q3 and price will be P3.