If real disposable income increases, the average propensity to save will
A) decrease. B) increase.
C) remain constant. D) initially increase, and then decrease.
B
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Four friends decide to have a party every Saturday. They decide to contribute to a pool of money that will be spent for the parties. The table shows the maximum amount each friend is willing to contribute for each party:
Number of parties Peter Mary Kate Jacob First party $250 $340 $120 $215 Second party $200 $270 $100 $160 Third party $135 $80 $70 $100 Fourth party $60 $100 $25 $40 If the cost of each party is $225, up to how many parties should they have to maximize total surplus? A) 1 B) 2 C) 3 D) 4
According to the IGM poll, most economists think that the crowding out effects were stronger than the stimulative effects of ARRA
a. True b. False Indicate whether the statement is true or false
Suppose the production function is given by Q = min{K, L}. How much output is produced when 4 units of labor and 9 units of capital are employed?
A. 13 B. 0 C. 4 D. 9
When the Federal Reserve uses open-market operations to lower the Federal funds rate several times over a year, it is pursuing:
a. A Taylor rule policy b. A restrictive money policy c. A prime interest rate policy d. An expansionary money policy