Historically, consumption spending in the United States has _____
a. fluctuated greatly with changes in the level of income
b. remained approximately constant as a percentage of income
c. decreased as a percentage of income
d. varied inversely with the inflation rate
e. varied inversely with the interest rate
b
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Assume that China has a comparative advantage in producing corn and exports corn to Japan. We can conclude that
A) Labor costs are higher for corn producers in Japan than in China. B) China also has an absolute advantage in producing corn relative to Japan. C) Japan has an absolute disadvantage in producing corn relative to China. D) China has a lower opportunity cost of producing corn relative to Japan.
In the graph for the consumption function, the 45-degree line
A) contains only a consumption component.
B) represents both planned consumption and planned investment.
C) shows various combinations where planned consumption equals real disposable income.
D) reflects a decreasing APC as real disposable income rises.
If a firm in a perfectly competitive market is currently producing the output where price = marginal cost > average total cost, the firm is:
A. earning a positive profit. B. earning a zero profit. C. suffering an economic loss. D. All of these
The largest International Monetary Fund quota subscription, denominated in Special Drawing Rights, is held by
A. the United States. B. Russia. C. Japan. D. China.