The Price of a Barrel of Oil Doubled Between 2007

question 12

Multiple Choice

The price of a barrel of oil doubled between 2007 and the middle of 2008.To make matters worse,a financial crisis hit the U.S.economy starting in August of 2007.Which of the following is true of the Chinese experience?

• A)The worldwide decline in demand led to a collapse of Chinese exports.
• B)Instead of relying solely on the economy's self-correcting mechanism,much more aggressive fiscal expansions than those of the U.S.(in addition to a substantial monetary easing)served to shift the AD curve back to general equilibrium relatively quickly.
• C)The Chinese economy was better able than the U.S.economy to weather the financial crisis with output growth starting to grow earlier and more quickly than that of the U.S.
• D)all of the above
• E)none of the above

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Definitions:

Journal Entry

A record in accounting that notes transactions and changes in financial statements.

Net Pay

The amount of money an employee takes home after all deductions, such as taxes and benefits, are taken out of their gross salary.

FICA Tax

Federal Insurance Contributions Act tax; a United States federal payroll (or employment) tax imposed on both employees and employers to fund Social Security and Medicare.

Federal Income Taxes

Federal income taxes are taxes levied by the national government on taxable income of individuals, corporations, trusts, and other legal entities.