Which of the following increases the slope of the consumption function?
A) an increase in consumer wealth
B) a decrease in the value of consumer durables
C) an increase in consumer confidence
D) an increase in the marginal propensity to consume
D
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If the U.S. economy enters a recession, the
A) labor force tends to increase. B) economy experiences full employment. C) unemployment rate tends to increase. D) entire population will be partially unemployed.
Spending money on a new car instead of a used car when you are on a fixed budget is an example of
A) a bad thing to do because you run out of money. B) living on the edge. C) the incursion of an opportunity cost. D) isolating variables.
What are some of the issues associated with the consumer price index?
What will be an ideal response?
Diseconomies of scale tend to occur in large firms because
a. the many layers of management are cumbersome and because it is difficult to monitor employees b. such firms are operating at inappropriate plant sizes for their output levels c. such firms are operating at a point above their long-run average total cost curves d. their ability to adjust their plant sizes is constrained by the existence of fixed inputs e. they fail to garner all the possible gains from specialization