To offset the effect of a steep fall in net exports on the economy, the government might:
a. increase government purchases.
b. decrease government purchases.
c. increase taxes

Catherine is risk averse. When faced with a choice between a gamble and a certain level of wealth, she will

A) always prefer the gamble. B) always prefer the certain level of wealth. C) prefer the gamble if the expected utility from it is higher than the utility from the certain level of wealth. D) prefer the certain level of wealth if the expected utility from the gamble is higher than the utility of the certain level of wealth.

Which of the following is true of cost-push inflation?

a. Cost-push inflation is associated with an economic expansion. b. Cost-push inflation is rarely experienced in developed economies. c. Cost-push inflation is caused by a decrease in aggregate supply. d. Cost-push inflation is identical to demand-pull inflation. e. Cost-push inflation is the result of increased consumer spending.