Suppose that X and Y are substitutes. If the price of Y increases, how will this change the market equilibrium for X?
a. Equilibrium price and quantity both decline
b. Equilibrium price and quantity both rise.
c. Equilibrium price declines, and equilibrium quantity rises.
d. Equilibrium price rises, and equilibrium quantity falls.
b
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Joe's Taco Hut can purchase a delivery truck for $20,000 and Joe estimates it will generate a net income (after taxes, maintenance and operating costs) of $2,000 per year. He has no other opportunities. He should:
A. purchase the truck if the real interest rate is greater than 10%. B. not purchase the truck if the real interest rate is greater than 2%. C. purchase the truck only if the real interest rate is less than 2%. D. purchase the truck if the real interest rate is less than 10%.
How do economists measure the "openness" of an economy? Explain if the U.S. economy has become more or less "open" over the past 60 years?
What will be an ideal response?
According to the Romer model, tax incentives to support research and development will lead to ________
A) higher tax rates in the future B) an increase in the general level of prices C) a decrease in the general level of prices D) increased per capita income
Total planned expenditure (equals income) is 13,500, autonomous consumption expenditure is 600, the marginal propensity to consume is 0.8, government purchases are 2,700, taxes are 2,500 and planned investment spending is 2,900
Net exports is ________. A) 3,840 B) negative 1,500 C) negative 1,380 D) negative 1,340 E) 2,100