Answer:
Year Exports - Imports Percentage of GDP
1997 -101.4 1.22%
1998 -161.8 1.84%
1999 -262.1 2.80%
2000 -382.1 3.84%
2001 -371 3.61%
We can see that the deficit in grew every year except for the year 2001, when it was reduced a bit. This was because the U.S. began to import more goods than it exported.
Answer:
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Explanation:
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Answer:
prices to fall according to the classical economists and unemployment to increase according to Keynes.
Explanation:
The classical economists believes that a decrease in aggregate demand for goods produced would being about fall in the prices of such goods. What this implies is that as more goods are produced, if such production is not backed by corresponding demand by consumers, the prices of such goods produced will eventually fall because supply is greater than demand.
For the Keynes, their argument is that a decrease in aggregate demand will cause unemployment to increase. This is because owners of businesses or employers would lay off their employees when goods produced exceeds the demand for such production by consumers. Here, owners of businesses pays their employees through sales of goods produced. So, when the goods produced are not purchased, then there will be excess availability of such goods; hence no sale or profit, from which salaries would be paid. The next step is to start laying off employees because employers cannot cover their running costs.
Answer:
The answer is D. The change in quantity demanded of a good that results from a change in price, making the good more or less expensive relative to other goods, holding constant the effect of the price change on consumer purchasing power
Explanation:
Substitution effect is a concept in which, as the price of a good or service increases, less of the good or service is substituted for other less expensive.
For example, if the price of Pepsi were to rise, the substitution effect would cause the consumer to buy less of it and substitute more coca-cola for now relatively more expensive Pepsi.
Option A. is wrong because we are talking about the quantity demanded and not just demand. (Please take note).
