If a good is _______, the income effect is negative for a price increase and positive for a price decrease.
A. inferior
B. superior
C. normal
D. Giffen
C. normal
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If the annual interest rate is 5%, the net present value of receiving $550 in the next year is:
a. $550 b. $523.80 c. $577.50 d. $500
The GDP chain price index is designed to adjust nominal GDP for changes in:
a. the level of transfer payments. b. the quality of goods over time. c. the costs of economic bads such as pollution and crime. d. the general level of prices over time.
As we move down and to the right along an indifference curve, the marginal rate of substitution:
A. increases. B. decreases. C. remains constant. D. increases, then decreases.
When a nation experiences economic growth:
A) its production possibilities curve shifts outward. B) its production possibilities curve shifts inward. C) it has been able to reach full employment. D) it has moved to a more consumer-oriented position on its production possibilities curve.