Suppose That the Economy Is in Equilibrium with the Government

question 39

Multiple Choice

Suppose that the economy is in equilibrium with the government budget is in deficit and with saving is less than investment.According to the circular flow model,

• A)imports must exceed exports
• B)imports must be less than exports
• C)imports must equal exports
• D)imports could be less than or equal to exports
• E)it is impossible to determine anything about imports and exports with the given information

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Definitions:

Homogeneous Products

Refers to goods that are identical in quality and features, making them perfect substitutes for each other in the eyes of consumers.

Decision Variable

A variable that represents choices available to the decision-maker in problem-solving or optimization scenarios.

Barriers

Obstacles that prevent entry into a market or impede growth and can be economic, regulatory, technological, or cultural.

Product Differentiate

The process of distinguishing a product or service from others in the market to make it more attractive to a particular target market.