Using real GDP on the horizontal axis instead of real disposable income implies that a marginal propensity to consume 0.75 generates for every additional $100 of real GDP
A) $25 of additional saving.
B) $56.25 of additional consumption spending.
C) $25 of additional saving and taxes.
D) $75 of additional real disposable income.
C
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If the demand effect dominates during a currency depreciation, then
A. real GDP should fall. B. real GDP should increase. C. the price level should fall. D. net exports should decrease.
Assume a one year U.S. bond pays 4.0% interest and a similar U.K. bond pays 5.2% interest. Which of the following changes will establish interest rate parity?
a. The British pound would be expected to appreciate by 1.2% against the U.S. dollar. b. The U.S. dollar would be expected to depreciate by 1.2% against the British pound. c. The British pound would be expected to depreciate by 1.2% against the U.S. dollar. d. The British pound would be expected to appreciate by 9.2% against the U.S. dollar. e. The U.S. dollar would be expected to appreciate by 9.2% against the British pound.
If the wage rate is $5 per hour, regardless of how many laborers are employed, the
a. total labor cost curve is horizontal b. total labor cost curve is upward sloping c. MPP must be constant d. total labor cost curve will increase at an increasing rate e. total labor cost curve will increase at a decreasing rate
Over the last half-century, which of the following countries has had the highest growth rate of output per capita?
A) Japan B) France C) United Kingdom D) United States