The income-expenditure multiplier arises because one person's additional spending becomes another person's additional income that will generate additional:
A. menu costs.
B. cyclical unemployment.
C. autonomous expenditure.
D. spending.
Answer: D
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A tax levied on imported goods is called a(n):
a. excise tax. b. quota. c. foreign profits tax. d. tariff.
The producer that requires a smaller quantity of inputs to produce a certain amount of a good, relative to the quantities of inputs required by other producers to produce the same amount of that good,
a. has a low opportunity cost of producing that good, relative to the opportunity costs of other producers. b. has a comparative advantage in the production of that good. c. has an absolute advantage in the production of that good. d. should be the only producer of that good.
The two main methods of measuring GDP are
A. the income approach and the expenditure approach. B. the income approach and the receipts approach. C. the saving approach and the investment approach. D. the goods approach and the services approach.
Suppose that the quantity of hamburgers is measured along the vertical axis and that the quantity of popcorn is measured along the horizontal axis. The vertical intercept is 10 hamburgers, and the slope of the budget line is -2. If the price of popcorn falls from $1 to $0.50, then we know that
A. the vertical intercept shifts to 5 hamburgers. B. the horizontal intercept shifts to 10 bags of popcorn. C. the vertical intercept shifts to 20 hamburgers. D. the horizontal intercept shifts to 20 bags of popcorn.