If the expected rate of return decreases
A. The demand for loanable funds will increase.
B. The demand for loanable funds will decrease.
C. The time value of money will increase.
D. Market participants will save less money.
Answer: B
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If the marginal propensity to consume (MPC) in your classmate's nation is 3/5 and the marginal propensity to save (MPS) in your country is 1/10, which of the following must be true?
a. The spending multiplier is larger in your classmate's nation than in your country. b. The spending multiplier is smaller in your classmate's nation than in your country. c. Autonomous consumption is higher in your classmate's nation than in your country. d. Autonomous consumption is lower in your classmate's nation than in your country. e. Total consumption is lower in your classmate's nation than in your country.
Cyclical unemployment is primarily caused by:
a. a large proportion of youthful workers in the labor force. b. fluctuations in aggregate demand. c. a lack of training on the part of job seekers. d. the failure of job seekers to search adequately for the available jobs.
Gross domestic product adds together many different kinds of goods and services into a single measure of the value of economic activity. To do this, GDP makes use of
a. market prices. b. statistical estimates of the value of goods and services to consumers. c. prices based on the assumption that producers make no profits. d. the maximum amount consumers would be willing to pay.
The principle of diminishing marginal utility states that:
A. you enjoy consuming more of a good if it is good. B. as you consume more of a good, you enjoy the additional units more than you did the initial units. C. you don't enjoy consuming more of a good. D. as you consume more of a good, you enjoy the additional units less than you did the previous units.