Suppose the only leakages are savings and taxes. The tax rate is 0.2 and the multiplier is 1.92. These values imply that the marginal propensity to consume is
A) 0.32.
B) 0.60.
C) 0.68.
D) 0.8.
B
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During the 20th century, U.S. death rates
(a) exhibited the same cyclical waves as birth rates. (b) fell with advancements in healthcare and medicine. (c) exhibited an upward trend. (d) generally stayed flat.
One reason for the short-run aggregate supply curve (SRAS) is:
a. fixed-wage contracts. b. perfect knowledge of workers. c. the upward-sloping production function. d. a fixed CPI market basket.
Figure 9.2 represents the market for used cameras. Suppose buyers are willing to pay $125 for a plum (high-quality) used camera and $25 for a lemon (low-quality) used camera. If buyers believe that all of the used cameras in the market are lemons (low quality), what number of used cameras sold will actually be lemons (low quality)?
A. 10 B. 15 C. 20 D. 25
A U.S. firm currently produces 200 units of output according to the production function q = L0.5K0.5 and faces input prices equal to wU.S. = rU.S = $11. Should the U.S. firm move their company abroad where they will face input prices equal to wabroad = $6.50 and rabroad = $15.00?
A) Yes, because the total costs will fall from $3,859 to $2,810. B) No, because the total costs will increase from $2,810 to $3,859. C) No, because the firm has decreasing returns to scale. D) Not enough information is given to answer this problem.