In Which Case Can We Be Sure That Real GDP

question 8

Multiple Choice

In which case can we be sure that real GDP and the price level rise in the short run?

• A)foreign economies expand and taxes increase.
• B)foreign economies expand and taxes decrease.
• C)foreign economies contract and taxes decrease.
• D)foreign economies contract and taxes increase.

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Definitions:

Future Value

The amount to which some current amount of money will grow if interest earned on the amount is left to compound over time.

Imperfectly Competitive

A market structure where individual firms have some control over the price of their products due to factors like brand differentiation and barriers to entry.

Future Value

The value of an investment or sum of money at a specified future date, calculated by applying a rate of interest or return.

Stock Portfolio

A collection of stocks owned by an individual or an institution, managed as a single entity with specific investment goals and strategies.