The sum of the marginal propensity to consume (MPC) and the marginal propensity to save (MPS) always equals:
a. 1.
b. 0.
c. the interest rate.
d. the marginal propensity to invest (MPI).
a
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A country has a current account surplus of $256 billion. This implies that ________
A) net factor payments from abroad is negative B) payments received from foreigners exceed payments to foreigners C) net transfers from abroad is negative D) its imports exceed its exports by $256 billion
If brokerage commissions on bond sales decrease, then, other things equal, the demand for bonds will ________ and the demand for real estate will ________
A) increase; increase B) increase; decrease C) decrease; decrease D) decrease; increase
According to Irving Fisher, velocity ________
A) is determined by institutions that affect the way individuals transact B) is affected by institutions only gradually C) is assumed constant in the short run D) all of the above E) none of the above
Which of the following is an example of an innovation that can lead to new investment and spur the economic growth of a nation?
a. Horizontal drilling and hydraulic fracturing resulting in the discovery of new sources of shale gas in the U.S. b. Outsourcing the manufacturing units of a U.S. shoe-making company, resulting in the reduction of overhead costs c. A tire manufacturer laying off some of its workers to increase its profit margin d. An automobile-manufacturing company using cheaper machines for its main product line