Which one of the following statements is INCORRECT? A Keynesian economists believe that the business cycle is caused by external factors, such as government interference in the economy. B Classical economists believe that market economies are inherently stable and fluctuations are ascribed to exogenous factors. C Classical economists believe that government should not intervene in the economy to try to smooth out the business cycle. D Structuralist economists believe that the market system is neither inherently stable nor systematically unstable
Which one of the following statements is INCORRECT?
A Keynesian economists believe that the business cycle is caused by external factors, such as government
interference in the economy.
B Classical economists believe that market economies are inherently stable and fluctuations are ascribed to
exogenous factors.
C Classical economists believe that government should not intervene in the economy to try to smooth out the
business cycle.
D Structuralist economists believe that the market system is neither inherently stable nor
systematically unstable
. Consider the case of two countries, Afghanistan and the US, both producing carpets and fighter aircraft.
The table below shows output rates per day in the two countries if all resources are fully and efficiently
employed. Use this information to answer the question.
Carpets Fighter aircraft
Afghanistan 100 4
US 500 25
An appropriate international exchange ratio that would allow mutually advantageous trade to take
place would be:
A 1 aircraft = 25 carpets.
B 1 aircraft = 20 carpets.
C 1 carpet = 4 aircrafts.
D 1 aircraft = 22 carpets.
The ________
This demand for money is a function of ________.
A Precautionary; interest rates
B Transactions;
C Speculative; interest rates
D Precautionary; national income
7. As the interest rate ________, the
to hold________ money.
A increases, increases, more
B decreases, decreases, more
C increases, decreases, less
D decreases, increases, more
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