If the MPC is 0.6 and the tax rate is 20%, a $200 decrease in autonomous net exports will decrease equilibrium income by
A) $384.
B) $416.
C) $478.
D) $1,666.
A
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Most economists believe that the CPI overstates the actual changes in prices while the chain index for GDP understates them
Indicate whether the statement is true or false
The automatic budget surpluses and budget deficits that occur in the federal budget over the business cycle
A) stabilize the economy. B) destabilize the economy. C) decrease potential GDP. D) increase potential GDP.
The purchase of a new automobile is included in
A) investment expenditures. B) consumption expenditures on durable goods. C) consumption expenditures on nondurable goods. D) consumption expenditures on services.
A linear downward-sloping demand curve has price elasticities (in absolute values) that
A) increase as price decreases. B) remain constant along the demand curve. C) decrease as price decreases. D) are greater than or equal to 1.