A recession can be expected to reduce inflation in the economy if the recession is caused by a(n)
A. increase in aggregate demand.
B. increase in aggregate supply.
C. decrease in aggregate demand.
D. decrease in aggregate supply.
Answer: C
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If consumption is defined as C = 2,400 + 0.9Y, then the marginal propensity to consume is 0.9
Indicate whether the statement is true or false
The marginal social benefit is the:
A. benefit gained by the last user. B. sum of the marginal benefit gained by each individual user. C. total benefit gained by the last user. D. sum of the benefit gained by each individual user.
Fine-tuning is most consistent with which school of economic thought
A. Keynesian or Modern Keynesian economics. B. Marxism. C. Monetarism or new classical economics. D. Supply-side economics or new classical economics.
Linda fishes for mahi mahi at a cost of $10 per ton. Tessa fishes at a cost of $8 per ton. Both have one 1000 ITQ and the current market price is $13. If Linda sold her ITQ to Tessa for $4000, society would benefit from:
A. More fish being caught B. Less fish being caught C. An efficiency saving in fishing costs of $2000 D. An efficiency saving in fishing costs of $5000