The slope of the consumption function is called the:
a. autonomous consumption rate.
b. marginal consumption rate.
c. average propensity to consume.
d. marginal propensity to consume.
d
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Suppose that Paraguay can produce 12 wheat or 3 corn and Bolivia can produce 4 wheat or 2 corn. Suppose that opportunity costs are constant. Which of the following is a potentially agreeable trade arrangement for Paraguay and Bolivia?
A) Paraguay trades one corn to Bolivia for three units of wheat. B) Bolivia trades one corn to Paraguay for three units of wheat. C) Bolivia trades one corn to Paraguay for one wheat. D) Paraguay trades one wheat to Bolivia for two corn.
According to the theory of rational expectations, when it comes to expected changes in the inflation rate, the short-run Phillips curve would be: a. vertical
b. horizontal. c. upward sloping. d. downward sloping.
A speculative attack on an overvalued currency leads to a(n) ________ in international reserves and a(n) ________ in the fundamental value of the currency.
A. increase; decrease B. increase; increase C. decrease; decrease D. decrease; increase
Which of the following are economic themes considered in macroeconomics?
a. A firm's output b. The level of prices in the economy c. The unemployment rate d. A firm's income or total revenues e. National income