The relative cost of achieving a fixed standard of living in different situations is called:

A. a cost of living index.

B. compensating variation.

C. real income.

D. consumer surplus.


A. a cost of living index.

Economics

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The price effect refers to how changes in

A) price affect real income. B) price affect the quantity of a good consumed. C) income affect prices. D) preference affect prices.

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Assume the properties of normal indifference curves. Where will a consumer maximize their utility?

What will be an ideal response?

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In Figure 3-7 above, the multiplier is

A) 2. B) 0.2. C) 5. D) 2.5.

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Suppose the dollar depreciates from 89 Japanese yen to 79 Japanese yen. One would expect

a. U.S. imports to increase b. U.S. exports to increase. c. Japanese exports to increase. d. Japanese net exports to increase.

Economics