The downward slope of the demand curve is attributed to:
a. the inverse relationship between price and quantity demanded.
b. the direct relationship between income and quantity demanded.
c. the direct relationship between price and quantity demanded.
d. the inverse relationship between income and quantity demanded.
e. the direct relationship between consumer preferences and quantity demanded.
a
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A transfer payment is a sum of money
A. spent by government for new goods and services. B. shifted between members of a household. C. given by government without a good or service in exchange. D. moved between companies for goods and services. E. required to pay taxes.
Suppose that there is an increase in the demand for money. What is the appropriate monetary policy response in the New Keynesian sticky price model?
A) an increase in the interest rate target B) no change in the interest rate target C) a decrease in the interest rate target D) an increase in government spending
In which phase of the business cycle does a recession occur?
A) contraction
B) peak
C) recovery
D) expansion
Two firms, Acme and FirmCo, have access to five production processes, each of which has a different cost and gives off a different amount of pollution. The daily costs of the processes and the corresponding number of tons of smoke emitted are shown in the table below.ProcessABCDE(smoke/day)(4 tons/day)(3 tons/day)(2 tons/day)(1 tons/day)(0 tons/day)Cost to Acme ($/day)$750$800$1,000$1,400$2,000Cost to FirmCo ($/day)$500$750$1,200$2,200$4,000 If pollution is unregulated, the two firms will produce using process ________, and a total of ________ tons of smoke will be emitted each day.
A. C; 12 B. A; 20 C. D; 4 D. B; 16