Aggregate demand includes:
a. the demand for intermediate goods and final goods.
b. all monetary and nonmonetary transactions.
c. the demand for investment, including stocks, bonds, and gold.
d. the demand for final goods and services.
Question 2In 2009, household spending was the smallest component of total spending in the U.S. economy.
a. True
b. False
Indicate whether the statement is true or false
Question 3It can be said that, ultimately, consumers are the driving force behind answers to the three basic economic questions faced by societies. Explain the consumer's role in providing these answers.
Question 4Which of the following is not a component of aggregate demand?
a. Investment expenditures
b. Government expenditures
c. Net exports
d. All of the above are components of aggregate demand.
Question 5A household consists of only related family members like a father, mother, and children and not unrelated members like two students sharing a rented apartment.
a. True
b. False
Indicate whether the statement is true or false
Question 6The circular flow model indicates that income flows from households to firms through product markets and back from firms to households through factor markets. Is the total amount spent by all households equal to the total income that flows back to all households? Why or why not? Is the amount spent by each individual household equal to the amount that flows back to that specific household? Why or why not?
Question 7Which of the following is the most unstable category of GDP?
a. consumption
b. investment
c. government purchases
d. net exports
Question 8A person obtains income by selling the services of the resources that he or she owns.
a. True
b. False
Indicate whether the statement is true or false
Question 9Which of the following is NOT illustrated by a production possibility curve?
a. scarcity
b. opportunity cost
c. necessity for choice
d. price
Question 10The long-run equilibrium level of RGDP only changes when the LRAS shifts.
a. True
b. False
Indicate whether the statement is true or false
Question 11An unmarried couple holding joint title to their condominium constitutes a household.
a. True
b. False
Indicate whether the statement is true or false
Question 12The position of a country's production possibilities curve in the future will be affected by:
a. the rate of technological progress.
b. discoveries of supplies of natural resources.
c. the growth rate of productivity in the country.
d. all of the above.
Question 13In long-run equilibrium, employment is at full employment and unemployment is at the natural rate of unemployment.
a. True
b. False
Indicate whether the statement is true or false
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