When disposable income increases,
A) the consumption function shifts downward.
B) there is a movement downward along the consumption function, but the consumption function does not shift.
C) there is no movement along the consumption function, and the consumption function does not shift.
D) the consumption function shifts upward.
E) there is a movement upward along the consumption function, but the consumption function does not shift.
E
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One "problem" with applying the Jorgenson theory of investment to project investment is that
A) the MPK is known with certainty by business executives but the user cost is uncertain. B) the MPK is known with uncertainty by business executives but the user cost is certain. C) both user cost and the MPK are uncertain. D) it does not explain the accelerator.
If total production is less than total expenditures, then business firms
A) have overproduced. B) will cut back on production. C) will raise production. D) will experience increases in inventory. E) a and d
Which of the following happens to the demand for coffee when the price increases?
a. It stays the same.
b. It decreases.
c. It increases
d. It fluctuates.
Suppose Firm A and Firm B are considering whether to invest in a new production technology. For each firm, the payoff to investing (given in thousands of dollars per day) depends upon whether the other firm invests, as shown in the payoff matrix below.
Which of the following statements is correct?
A. It cannot be determined whether Firm A has a dominated strategy. B. "Invest" is a dominated strategy for Firm A. C. "Don't invest" is a dominated strategy for Firm A. D. Firm A does not have a dominated strategy.