The extent to which a given change in investment affects aggregate demand depends:
a. on the change in interest rate.
b. on the size of the spending multiplier.
c. on the change in money supply.
d. on the change in investment.
b
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Refer to Figure 5-4. Why is there a deadweight loss?
A) because the marginal social cost of producing each additional unit in excess of Q2 exceeds the marginal benefit B) because the marginal social benefit of producing each additional unit in excess of Q2 exceeds the private cost C) because the marginal private cost of producing each additional unit in excess of Q2 exceeds the marginal benefit D) because the marginal private benefit of producing each additional unit in excess of Q2 exceeds the social cost
Historically the return on stocks has been higher than the return on bonds. In part this reflects the higher risk from holding stock
a. True b. False Indicate whether the statement is true or false
The ticket price of zero for the viewing of a television show taping often results in a shortage of tickets which are frequently rationed on a first-come-first-served basis
Indicate whether the statement is true or false
Which of the following statements is true?
a. When a monopoly firm sells an additional unit of output, its revenue increases by an amount less than the price. b. When a monopolistic firm decides to increase price, its profit will increase. c. When a competitive firm sells an additional unit of output, its revenue increases by an amount less than the price. d. Average revenue is the same as price for both competitive and monopoly firms.