If the cross-price elasticity of demand between two goods is -1.2, then the two goods are:
A. substitutes.
B. complements.
C. inferior.
D. elastically demanded.
Answer: B
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Movement of the fast-growing Asian nations through the demographic transition may have had an impact on growth rates because it
A) reduced expenditures on health care. B) reduced expenditures on pensions. C) increased savings. D) increased consumption relative to GDP. E) increased the number of retired people.
The textbook cites an estimate of the "sacrifice ratio" in the United States of approximately
A) one-third. B) one-half. C) one. D) three. E) six.
Total planned expenditure is composed as
a. planned investment. b. planned government spending and taxes. c. total investment, total consumption, and government spending. d. planned investment, planned government spending, and planned taxes.
An increase in investment demand for any given level of income and interest rates—due, for example, to more optimistic "animal spirits"—will, within the IS-LM framework, ______ output and ______ interest rates.
Fill in the blank(s) with the appropriate word(s).