If the marginal propensity to consume is very close to zero, then the multiplier
A) cannot be calculated.
B) is very close to one.
C) is very large.
D) is very close to zero.
E) might be negative if the marginal tax rate is large enough.
B
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Another term for the opportunity cost of capital is
A) the normal interest rate. B) the normal rate of return. C) a normal profit. D) a normal wage rate.
Which of the following is a reason why the governments of the weaker economies of Europe have limited ability to engage in bank bailouts?
A. Their home currencies are volatile and vulnerable to depreciation. B. They are prohibited to do so by their central banks. C. They cannot reform their budgets to be able to receive assistance. D. They do not have the ability to borrow the required amount of funds.
Which of the following will control incentive problems in a corporation?
A. Managers and employees adopting higher and stringent ethical standards B. Managers and employees adopting predefined ethical standards C. Managers forcing employees to adopt higher and stringent ethical standards D. Managers checking on their employees email and other activities closely
Real GDP per capita is found by dividing real GDP by the size of the labor force.
a. true b. false