What is the difference between saving and savings?
What will be an ideal response?
Saving is the part of after-tax income that one does not spend. It is a flow variable. Savings is used as a synonym for wealth. It is a stock variable.
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In considering the costs involved for student loans that must be repaid in ten years, this Application is addressing the economic concept of
A) the principle of diminishing returns. B) the real-nominal principle. C) the marginal principle. D) the principle of voluntary exchange.
If the U.S. interest rate rises while interest rates in the rest of the world do not change, the higher U.S. interest rate
A) decreases the demand for dollars. B) increases the demand for dollars. C) has no effect on the demand for dollars. D) will stop all trading between the currencies of the U.S. and other countries.
U.S. data suggest that the U.S. economy is located where on the Laffer curve?
A) On the right side, after the peak in tax revenue. B) On the left side, before the peak in tax revenue. C) At the peak in tax revenue. D) The economy was on the right side before the 1980s and on the left side after 1980.
If MPC = 2/3, a decrease in government purchases of $10 billion will ultimately lead to:
a. a $30 billion increase in aggregate demand. b. a $10 billion increase in aggregate demand. c. a $10 billion decrease in aggregate demand. d. a $30 billion decrease in aggregate demand.