A risk-neutral person will invest in a project by examining if
A) the expected utility associated with the project is positive.
B) the marginal utility associated with the project is positive.
C) the expected net present value is positive.
D) All of the above.
C
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The larger the MPC: a. the smaller the multiplier
b. the smaller the effect of a given increase in government purchases on consumption purchases. c. the larger the effect of business taxes which reduce investment on aggregate demand. d. the less powerful changes in individual taxes will be in changing aggregate demand.
Raising the tax rate lowers the tax-adjusted MPC
Indicate whether the statement is true or false
You lend $5,000 to a friend for one year at a nominal interest rate of 10%. Inflation during that year is 5%. As a result, you will receive ________ at the end of the year, but that money has a purchasing power of ________
A) $5,050; $5,025 B) $5,100; $5,050 C) $6,000; $5,500 D) $5,500; $5,250
Table 8-2 Price Quantity Total Cost$22 6$ 60 2010100 1816160 1621210 1428280? In Table 8-2, the profit-maximizing level of output is
A. 6 B. 10 C. 16 D. 21