In early 2012 the price of computer hard disc drives rose. In a demand and supply model, shifts in what curve or curves could have brought about the higher price?
What will be an ideal response?
The higher price could have been brought about by an increase in demand, a decrease in supply, or the combination of an increase in demand combined with a decrease in supply. Hence the higher price could have been the result of a rightward shift in the demand curve, a leftward shift in the supply curve, or a combined rightward shift of the demand curve and leftward shift of the supply curve.
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The tendency of many different economic variables to have regular and predictable patterns over the business cycle is called
A) persistence. B) comovement. C) periodicity. D) recurrence.
Michael faces tradeoffs between consuming in the current period when he is young and consuming in a future period when he is old. Michael experiences a decrease in the current interest rate he earns on his savings. Michael will save
a. less in the current period if the substitution effect is greater than the income effect. b. less in the current period if the income effect is greater than the substitution effect. c. more in the current period if the substitution effect is greater than the income effect. d. more in the current period, regardless of the sizes of the income and substitution effects.
In the long run, a decrease in money supply, with the velocity of money stable or not decreasing, results in inflation
Indicate whether the statement is true or false
If we were on curve K, the upper two quintiles received about _____% of income.
A. 25
B. 35
C. 45
D. 55