Ignoring the government and foreign sectors, there is an unplanned decrease in inventories of $200 billion at the current level of real national income of $12 trillion. From this information, we know that
A) saving equals $200 billion.
B) consumption expenditures equal $12 trillion less saving less $200 billion.
C) planned investment is $200 billion more than planned saving.
D) planned investment is $200 billion less than planned saving.
Ans: C) planned investment is $200 billion more than planned saving.
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An industry is characterized by scale economies and exists in two countries. In order for consumers of its products to enjoy both lower prices and more variety of choice
A) the two countries must engage in international trade with each other. B) each country's marginal cost must equal that of the other country. C) the marginal cost of this industry must equal marginal revenue in the other. D) the monopoly must lower prices in order to sell more. E) they must combine to become a multinational corporation.
According to the text, during World War II rationing was conducted in the U.S. through the use of
A) queuing. B) lotteries. C) coupons. D) sharing.
Suppose you go to a wedding reception that has free drinks. What is likely to be the marginal utility of the last drink you had?
a. infinite b. 0 c. 1 d. less than 0 e. greater than 1
If all variable taxes in the United States were removed and only fixed taxes remained, what would be the effect on the expenditures schedule?
a. The expenditure schedule will shift upward and become steeper. b. The expenditure schedule will shift upward and become less steep. c. The expenditure schedule will shift downward and become less steep. d. The expenditure schedule will shift downward and become steeper.