A drop in the user cost of capital will lead to an equal ________ in the MPK of profit-maximizing firms, requiring a ________ v*, thus ________ gross investment
A) drop, higher, boosting
B) drop, lower, dampening
C) drop, lower, boosting
D) rise, higher, dampening
E) rise, lower, boosting
A
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If the government decides to spend an extra $4 billion on fighter jets that they would otherwise have spent on computers, and the MPC = 0.75, what is the effect on AD?
a. AD increases by $20 billion. b. AD increases by $16 billion. c. AD increases by $4 billion. d. AD does not change.
Vault cash would be considered
A. a primary reserve. B. a secondary reserve. C. both a primary and a secondary reserve. D. neither a primary nor a secondary reserve.
If the Consumer Price Index was 165 in one year and 175 in the next year, then the rate of inflation from one year to the next was approximately:
a. 4.3 percent b. 5.7 percent c. 7.5 percent d. 6.1 percent
After browsing his cabinets to see what meals he can make, Ken is deciding whether to make nachos or spaghetti for dinner. If Ken makes spaghetti, we can conclude:
A. Ken doesn't like nachos. B. Ken will get more utility from making spaghetti for dinner than nachos. C. Ken prefers nachos over spaghetti. D. None of these is true.