For saving to increase, consumption must decrease, ceteris paribus
Indicate whether the statement is true or false
True
You might also like to view...
Starting from long-run equilibrium, a large decrease in government purchases will result in a(n) ________ gap in the short-run and ________ inflation and ________ output in the long-run.
A. expansionary; lower; potential B. expansionary; higher; potential C. recessionary; lower; potential D. recessionary; lower; lower
Suppose the government imposes a price support that is above the equilibrium price. As a result,
A) total revenue increases. B) consumer surplus increases. C) the marginal cost of the last unit produced decreases. D) the government has effectively imposed a price ceiling. E) the subsidy the government pays decreases.
Refer to Figure 9-1. Suppose the government allows imports of leather footwear into the United States. The market price falls to $18. What is the value of consumer surplus?
A) $0 B) $270 C) $305 D) $320
An assumption that makes an economic model simpler without affecting its conclusions in important ways is
a. an indication of a positive assumption b. an efficient assumption c. useful in disguising the valid conclusions d. a simplifying assumption e. a critical assumption