The multiplier is calculated as the change in ________ divided by the change in ________
A) real GDP; induced spending B) nominal GDP; autonomous expenditure
C) real GDP; autonomous expenditure D) autonomous expenditure; real GDP
C
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Last year, Jack's income was $15,000 and he bought 50 bags of potato chips. This year his income is $18,000 and he buys 55 bags of potato chips. Therefore, Jack's
A) income elasticity of demand for potato chips is 0.52. B) price elasticity of demand for potato chips is 0.52. C) income elasticity of demand for potato chips is 1.66. D) price elasticity of demand for potato chips is 1.66.
Which of the following statements is TRUE about the optimal quantity of pollution?
A) It equals zero. B) Pollution abatement should continue up to the point where marginal cost equals the average total cost. C) Trade-offs exist between producing a cleaner environment and producing other goods and services. D) Firms should be allowed to determine the profit-maximizing amount of pollution abatement.
Two variables that are inversely related tend to move in opposite directions
a. True b. False Indicate whether the statement is true or false
If price rises, what happens to quantity demanded for a product?
a. It increases. b. It decreases. c. It does not change. d. Uncertain-economic theory has no answer to this question.