Evalute of macroeconomic theories and production possibilities curve.
Disputes over Macro Theory and Policy
Use the following to answer problems 1-2:
1. Refer to the above diagrams. Classical theory is best portrayed by:
2. Refer to the above diagrams. Keynesian theory is best portrayed by:
3. According to the equation of exchange, changes in the money supply can affect:
Use the following to answer problems 4:
Answer the next problem(s) on the basis of the following information for a hypothetical economy. All values are in nominal terms.
M = $100
V = 2
Ca = $160
Xn = $10
G = $10
4. Refer to the above information. Nominal GDP is:
International Trade
Use the following to answer problems 4-5:
5. Refer to the above diagrams. The solid lines are production possibilities curves; the dashed lines are trading possibilities curves. The data suggest that:
6. Refer to the above diagrams. The solid lines are production possibilities curves; the dashed lines are trading possibilities curves. The trading possibilities curves imply that:
7. In the U.S. balance of payments, foreign purchases of assets in the United States are a: