Assume that the Cambridge k = 0.2. If income increases by $20,000, the demand for money will change by
A) $20,000.
B) $10,000.
C) $5,000.
D) $4,000.
D
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If a country lacks ________, economic growth ________
A) a democratic form of government; cannot occur B) a proper incentive system; cannot occur C) pure capitalism; will be slower compared to other countries D) a proper incentive system; will occur at a pace suggested by the new growth theory E) economic freedom; will increase at a faster pace
Amos Long's marginal utility of income function is given as: MU(I) = I1.5, where I represents income. From this you would say that he is
A) risk averse. B) risk loving. C) risk neutral. D) none of the above
Commodity markets resemble
A) monopolistic markets. B) competitive markets. C) oligopolistic markets. D) factor markets.
If the marginal propensity to consume (MPC) is 0.80, and if policy makers wish to increase real GDP by $200 million, then by how much would they have to change taxes?
a. -$240 million b. -$200 million c. -$180 million d. -$50 million