Suppose the MPC in an economy is 0.9. The APC is initially 0.95 and disposable income is $4 billion. If disposable income increases to $14 billion, what is the new level of consumption?
A. $12.8 billion.
B. $12.6 billion.
C. $13.3 billion.
D. $9 billion.
Answer: A
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If the demand curve for tacos is a downward sloping straight line, at which of the following prices is the demand the most elastic?
A) a price of $0.50 per taco B) a price of $1.00 per taco C) a price of $1.50 per taco D) There is not enough information given to determine at which price the demand is most elastic.
Demand deposits are
a. deposits held by individuals at one of the twelve Federal Reserve District Banks. b. interest-earning savings deposits held by individuals at a banking institution. c. deposits of commercial banks at one of the twelve Federal Reserve District Banks. d. deposits of individuals that can either be withdrawn or made payable on demand to a third party by a check.
Moving production from a high-cost producer to a low-cost producer will
a. lower total surplus. b. raise total surplus. c. lower producer surplus. d. raise producer surplus but lower consumer surplus.
In Figure 29.1, the area that represents the value to the consumer under monopoly is
A. ABC. B. OACQPC. C. PPCAC. D. OABQMonopoly.