-In the Figure Above, the DLF Curve Is the Demand

question 115

Multiple Choice

-In the figure above, the DLF curve is the demand for loanable funds curve and the PDLF curve is the private demand for loanable funds curve.If there is no Ricardo-Barro effect, the figure shows the situation in which the government has a ________ so that the equilibrium real interest rate is ________ and the equilibrium quantity of investment is ________.

• A) budget surplus; 4 percent; $1 trillion
• B) budget deficit; 4 percent; $1 trillion
• C) budget deficit; 6 percent; $1.5 trillion
• D) budget surplus; 6 percent; $1.5 trillion
• E) balanced budget; 6 percent; $1.5 trillion

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Definitions:

Two-factor Theory

A theory suggesting emotion is based on physiological arousal and cognitive labeling of that arousal.

Schachter-Singer Theory

A theory of emotion that states emotions are determined by physiological arousal and the cognitive interpretation of that arousal.

Spinal Cord

A major part of the central nervous system which conducts sensory and motor nerve impulses to and from the brain.

James-Lange Theory

A theory proposing that emotions arise from physiological reactions to events.