If the price level increases by 15 percent while nominal income increases by 8 percent, then in percentage terms real income would:
a. Rise by about 8 percent
b. Fall by about 8 percent
c. Fall by about 7 percent
d. Fall by about 15 percent
c. Fall by about 7 percent
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If both the supply and demand curves shift to the left, then we can conclude that there will be
A. an increase in the equilibrium quantity sold. B. a decrease in the equilibrium quantity sold. C. an increase in the equilibrium price. D. a decrease in the equilibrium price.
________________ —a term describing a tool that economists use to determine the effect of an economic event on equilibrium price and quantity.
a. Equilibrium price b. The four-step process c. Demand schedule d. Supply schedule
Name and describe two forms of market failure. Give an example of each.
What will be an ideal response?
The first-order conditions for a monopoly to maximize profits are:
A. d?(Q)/dQ = 0. B. MR(Q) = MC(Q). C. dR(Q)/dQ = dC(Q)/dQ. D. All of the statements associated with this question are correct.