John Maynard Keynes's central proposition that a dollar increase in disposable income would increase consumption, but by less than the increase in disposable income, means the marginal propensity to consume (MPC) is:
A. greater than or equal to one.
B. equal to one.
C. less than one, but greater than zero.
D. negative.
Answer: C
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One disadvantage of a fixed exchange rate system compared to a floating or managed float exchange rate system is
A) it more difficult for central banks to control inflation. B) it does not allow for government intervention. C) it can worsen inflation if domestic prices of imports rise quickly. D) it eliminates the possibility of depreciation during a recession.
When a nation's currency suddenly loses value, the ________ may step in to buy the afflicted currency
A) World Bank B) International Monetary Fund C) Federal Reserve Bank D) United Nations
Which of the following pairs is the best example of complements?
a. Coffee and tea. b. DVDs and tapes. c. Hiking boots and athletic shoes. d. Tortillas and salsa.
The point where both x and y are zero is known as the
a. origin. b. null. c. zero coordinate. d. center.