Refer to Figure 15-11. In the dynamic model of AD-AS in the figure above, if the economy is at point A in year 1 and is expected to go to point B in year 2, the Federal Reserve would most likely
A) decrease the inflation rate. B) decrease interest rates.
C) not change interest rates. D) increase interest rates.
B
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When we solve the firm's dual production problem (i.e., maximize output subject to a cost constraint) by the method of Lagrange multipliers, the optimal value of the Lagrange multiplier equals the:
A) marginal product per unit cost of each variable input. B) marginal product of capital. C) marginal product of labor. D) marginal cost of production.
Commodity egalitarianism suggests that some goods be available to everyone.
A. True B. False C. Uncertain
Here is a consumption function: C = C0 + MPC(Yd). If MPC is 0.75, then we know that
A) as Yd rises by $1, Co rises by $0.75. B) as Yd rises by $1, C rises by $0.75. C) Yd rises by $0.75. D) as C0 rises by $0.75, Yd rises by $1.
Refer to the accompanying figure.
If Zeynep's current budget constraint is BC2, and her budget for ham sandwiches and cheese sandwiches is $120, then the price of a cheese sandwich is:
A. $12. B. $6. C. $2. D. $9.