The concept of choosing the least-cost combination of resources for a given amount of output is known as
a. technical efficiency.
b. the principle of diminishing marginal returns.
c. economic efficiency.
d. decreasing returns to scale.
c. economic efficiency.
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When an economy is in an economic boom, discretionary fiscal policy would call for _____________, and the automatic stabilizers would _____________.
A. lowering tax rates; lower tax revenues B. lowering tax revenues; lower tax rates C. increasing tax rates; increase tax revenues D. increasing tax rates; lower tax revenues
Expansionary monetary policy:
A. raises interest rates, raising both investment and net exports. B. lowers interest rates, increasing investment and decreasing net exports. C. lowers interest rates, increasing both investment and net exports. D. raises interest rates, decreasing both investment and net exports.
Which of the following would lead to a decrease in autonomous consumption spending?
a. a decrease in disposable income b. an increase in disposable income c. an increase in the interest rate d. more optimistic expectations about future income e. an increase in wealth
If the budget line shifts from BB to bb in the above diagram we can infer that the:
A) price of Y has increased and the price of X has decreased. B) price of Y has decreased and the price of X has increased. C) prices of both X and Y have increased. D) prices of both X and Y have decreased.