Here is a consumption function: C = C0 + MPC(Yd). If C0 = $200, then we know that
A) if Yd is zero, C will be $200.
B) when Yd rises, C rises by $200.
C) when Yd falls, C falls by MPC times C0.
D) C will always equal C0.
A
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If Texans decrease their purchases of Mexican beer, assuming all else remains constant, this will ________ of the United States
A) decrease the financial account balance B) decrease net exports C) increase the trade deficit D) decrease the current account balance
The concern of economists with respect to the trade deficit is whether it is
a. sustainable at current levels. b. desirable at current levels. c. under-specified. d. overestimated. e. the result of the financial crisis.
When a labor market experiences a surplus of labor, there is downward pressure on
a. the supply of labor. b. the final product price. c. wages. d. the demand for labor.
Erin borrowed $18,000 to buy a car. Her loan will be paid off in 5 years. By the time that she pays off the loan, she will have made $20,327 in payments. Why did she have to pay $2,327 more than the price of the car?
(A) She had to pay interest of $2,327 for the privilege of borrowing the creditor of $18,000. (B) She had to pay interest of $2,327 for the privilege of borrowing the principal of $18,000. (C) She had to pay the principal of $2,327 for the privilege of borrowing the mortgage of $18,000. (D) She had to pay a default of $2,327 for the privilege of borrowing the principal of $18,000.