If the marginal propensity to consume (MPC) increases, then
A. the multiplier increases.
B. the marginal propensity to save (MPS) increases.
C. the multiplier decreases.
D. MPC + MPS is less than 1.
Answer: A
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Total government revenues in the United States are about _____ percent of GDP
a. 25 b. 17 c. 45 d. 30
The following figure shows the production-possibility curves of Canada (AB) and the rest of the world (CD). The international price ratio faced by the countries is represented by the line P2. I1 and I2 are community indifference curves for Canada and the rest of the world. In the shift from no trade to free trade, cotton production in the world increases by ________ bale(s) and wheat production increases by ________ bushel(s).
A. zero; three B. one; zero C. zero; one D. twenty-four; nineteen
An article in the Wall Street Journal in early 2001 noted two developments in the market for laser eye surgery. The first development concerned side effects from the surgery, including blurred vision. The second development was that the companies renting
eye-surgery machinery to doctors had reduced their charges. In the market for laser eye surgeries, these two developments A) decreased demand and decreased supply, resulting in a decrease in the equilibrium quantity and an increase in the equilibrium price of laser eye surgeries. B) decreased demand and increased supply resulting in an increase in both the equilibrium quantity and the equilibrium price of laser eye surgeries. C) decreased demand and increased supply, resulting in a decrease in the equilibrium price and an uncertain effect on the equilibrium quantity of laser eye surgeries. D) decreased demand and increased supply, resulting in a decrease in both the equilibrium price and the equilibrium quantity of laser eye surgeries.
Describe the three main categories of firms
What will be an ideal response?