The average benefit of n units of an activity is the:
A. total benefit of n units divided by n.
B. extra benefit from carrying out one additional unit of the activity.
C. n times the total benefit of n units.
D. n divided by the total benefit of n units.
Answer: A
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Answer the following statements true (T) or false (F)
If the marginal propensity to save is 0.4, the multiplier is 2.5. Money will fail to serve as a medium of exchange if it ceases to be a store of value. Aggregate expenditure includes consumption spending, unplanned investment spending, government purchases, and net exports. When Jack's income increases by $1,000, he spends an additional $850 dollars. This implies that his marginal propensity to consume is 0.85. When the dollar becomes stronger compared to the Japanese Yen, then the Japanese imports from the U.S. will increase.
If the prices of domestic consumer goods increased while the prices of imported consumer goods decreased, and the demand for each remained the same, which of the following would most likely occur?
a. The GDP price index would decrease while the CPI would increase. b. Both the GDP price index and the CPI would decrease. c. The GDP price index would increase more than the CPI. d. The CPI would increase more than the GDP price index. e. Both the GDP price index and the CPI would increase by the same amount.
Suppose that an economy produces food and clothing, and a technological innovation occurs that enhances the productivity of resources used in producing both goods. Which of the following would be consistent with this situation?
a. There is a parallel outward shift of the PPF. b. The PPF rotates outward along the food axis, and remains fixed at the point of maximum clothing production. c. The PPF rotates outward along the clothing axis, and remains fixed at the point of maximum food production. d. There is a parallel inward shift of the PPF.
"Competition is the great regulator." This statement reflects that
What will be an ideal response?