The open-economy multiplier is equal to the reciprocal of the marginal propensity to save
Indicate whether the statement is true or false
FALSE
Explanation: It is equal to the reciprocal of the marginal propensity to save plus the marginal propensity to import.
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In the table above, y is measured along the y-axis and x along the x-axis. The slope of the relationship between x = 0 and x = 2 is
A) -6. B) 2. C) 3. D) 6.
Under a barter system
A) each good has many prices. B) each good has a single price. C) no prices for goods exist. D) prices for goods are very stable.
If the government sets a specific tax and an ad valorem tax so that they raise the same amount of tax revenue, why does the ad valorem tax reduce output less than the specific tax?
What will be an ideal response?
Which of the following is not an explicit cost?
a. salaries b. sales taxes c. the cost of utilities, such as gas and electricity d. insurance premiums e. the value of a firm owner's time