What key observation did the classical model attempt to explain? A. the economy performs well in the short run, but...
What key observation did the classical model attempt to explain?
| A. |
the economy performs well in the short run, but not so well in the long run |
|
| B. |
business cycles are the most important economic problem |
|
| C. |
over the short run, the economy performs rather poorly |
|
| D. |
markets do not clear without government intervention |
|
| E. |
over the long run, the economy performs rather well |
Which of the following four elements contribute to GDP in the expenditure approach?
| A. |
consumption spending, private investment, government purchases, net exports |
|
| B. |
consumption spending, business investment, government purchases, imports |
|
| C. |
consumption of services, private investment, government consumption, exports |
|
| D. |
consumption of goods, private investment, government investment, government consumption |
|
| E. |
consumption of durable goods, private investment, government purchases, net exports |
Homework Answers
1.According to classical model economic fluctuations are subject to short run only and the economy is in equilibrium in the long run.
Answer-E
2.GDP=Consumption spending+private investment+government purchases+net exports.
Answer-A
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