Which of the following are complementary goods?
A. trucks and sedans
B. sport utility vehicles and gasoline
C. white wine and red wine
D. butter and margarine
Answer: B
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Assume that the government increases spending and finances the expenditures by borrowing in the domestic capital markets. If the nation has highly mobile international capital markets and a flexible exchange rate system, what happens to the real risk-free interest rate and GDP Price Index in the context of the Three-Sector-Model?
a. The real risk-free interest rate rises, and GDP Price Index rises. b. There is not enough information to determine what happens to these two macroeconomic variables. c. The real risk-free interest rate and GDP Price Index remain the same. d. The real risk-free interest rate falls, and GDP Price Index falls. e. The real risk-free interest rate rises, and GDP Price Index falls.
. +21% ¸ +6% = +3.5. This coefficient indicates that each 1 percent increase in the price induces a ______ percent increase in the quantity supplied.
a. –35 b. –3.5 c. 35 d. 3.5
Refer to the table above. What is the marginal rent cost if the firm decides to choose factory Far over factory Very Far?
A) $40 B) $100 C) $150 D) -$150
Which of the following pairs of policies shift aggregate demand in the same direction? a. A tax increase and an increase in the money supply
b. A transfer payment decrease and an increase in the money supply. c. A reduction in government purchases and decline in the money supply. d. An increase in government purchases and a decline in the money supply.