Paradox of thrift - Samenvattingen, Aantekeningen en Examens

How does optimal price depend on price level P and output Y? correct answers Directly related - as output or price level grow, so too does optimal price Procyclicality of TFP - Classical correct answers TFP drives the business cycle Procyclicality of TFP - Keynesian correct answers Use factors of production at higher intensity during booms (Solow residual represents intensity increase/ is TFP) Procyclicality of Money Supply - Classical correct answers Reverse causality: Higher output Y ...

ECON 201: Introduction to Macroeconomics Latest Update 2023 Questions and Answers 100% Correct Highly Recommended Download to Score A 1. Real GDP is nominal GDP adjusted for: 2. What do a rubbernecking traffic jam and the paradox of thrift have in common? 3. Every year more and more purchases are made with credit cards on the Internet. Given this trend, all else equal, we would expect

When consumer confidence falls in an economy, _____ will decrease which is going to be _____ by the spending multiplier. correct answers spending; magnified What does the "paradox of thrift" say? correct answers An economy that saves too much can end up with lower savings. How does the spending multiplier compare between a $1,000 increase in government spending and a $1,000 decrease in taxes collected? correct answers An increase in government spending has a greater multiplier than an eq...

C. Each student in a room is a sophomore, a junior, or a senior. Each of these students has exactly one of the categorizations of sophomore, junior, and senior. How many students in the room are seniors? STATEMENT 1: There are a total of 36 students in the room, of which 1/3 are sophomores. STATEMENT 2: There are 14 juniors in the room. A. Statement (1) BY ITSELF is sufficient to answer the question, but statement (2) by itself is not. B. Statement (2) BY ITSELF is sufficient to ...

C. Each student in a room is a sophomore, a junior, or a senior. Each of these students has exactly one of the categorizations of sophomore, junior, and senior. How many students in the room are seniors? STATEMENT 1: There are a total of 36 students in the room, of which 1/3 are sophomores. STATEMENT 2: There are 14 juniors in the room. A. Statement (1) BY ITSELF is sufficient to answer the question, but statement (2) by itself is not. B. Statement (2) BY ITSELF is sufficient to answer th...

Chapter 4—Price: The Role of Demand and Supply MULTIPLE CHOICE 1. 2. 3. 4. 5. 6. For demand to exist, there must be a. a desire and an ability to buy. b. a supply of the product in the market. c. a price that is low enough to permit all consumers to afford the product. d. All of these. ANS: A PTS: 1 DIF: Easy NAT: TOP: B-Head: Law of Demand KEY: Bloom's: Knowledge The demand for a product at a given time is defined as the a. desire for it. b. sum spent on it. c. measure of to...

The result of a government crowding out the loanable funds market is? - Answer d. Increased government borrowing reduces loanable funds, increases the real interest rate and, thus, crowds private borrowers out of the loanable funds market. A good strategy for planning a comfortable retirement is? - Answer c. Save 10 to 15 percent of your income while working to fund retirement spending. According to the paradox of thrift? - Answer d. In the short run, increased spending might benefit the e...

Chapter 4—Price: The Role of Demand and Supply MULTIPLE CHOICE 1. 2. 3. 4. 5. 6. For demand to exist, there must be a. a desire and an ability to buy. b. a supply of the product in the market. c. a price that is low enough to permit all consumers to afford the product. d. All of these. ANS: A PTS: 1 DIF: Easy NAT: TOP: B-Head: Law of Demand KEY: Bloom's: Knowledge The demand for a product at a given time is defined as the a. desire for it. b. sum spent on it. c. measure of to...

What determines aggregate prices and output? - -Aggregate demand and supply -What determines interest rates in the short-run? - -The Fed controls interest rate -How does fiscal policy affect the economy (Arrow) - -G up -> D up -> p,y up T up -> Y-T down -> C down -> D down -> p,y down -How does the stock market affect the economy? (Arrow) - -S up -> W up -> C up -> D up -> y,p up -How does money "matter" (impact the economy) in the short-run? ) (Arrow...

Explains the concept of paradox of thrift with diagram. Helpful for exam prep as it provides detailed answers