A movement along a demand curve is
A. a change in demand and is caused by a change in the price of the good.
B. a change in the quantity demanded and can be caused by a change in consumers' income.
C. a change in the quantity demanded and is caused by a change in the price of the good.
D. a change in demand and can be caused by a change in consumers' income.
Answer: C
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In Econland autonomous consumption equals 700, the marginal propensity to consume equals 0.80, net taxes are fixed at 50, investment is fixed at 100, government purchases are fixed at 100, and net exports are fixed at 40. Aggregate expenditure equals
A. 900 + 0.80Y. B. 940 + 0.80Y. C. 990 + 0.80Y. D. 990 + 0.20Y.
When output is above the full employment level of real GDP, the Federal Reserve banks should ________.
A. lower the federal funds rate B. buy bonds C. raise the discount rate D. lower the reserve ratio
Refer to the above table. If the price of a hamburger is $2, the price of a concert ticket is $60, and the consumer has $128, what is the consumer optimum?
A. 2 hamburgers and 2 concerts B. 3 hamburgers and 2 concerts C. 4 hamburgers and 2 concerts D. 2 hamburgers and 3 concerts
Which of the following explains why two firms, Apex and Bongo, would engage in implicit collusion, rather than explicit collusion?
A) Implicit collusion allows Apex to increase its profits at the expense of Bongo without Bongo knowing that collusion has occurred; if Apex engages in explicit collusion, Bongo will realize collusion has taken place and retaliate against Apex. B) Implicit collusion is less costly to both firms than explicit collusion; therefore, profits will be greater for both firms if they engage in implicit collusion. C) explicit collusion is illegal; if the managers of Apex and Bongo engage in implicit collusion they may be within the law. D) Implicit collusion always has an enforcement mechanism that forces both firms to collude; explicit collusion does not have an enforcement mechanism.