The absolute value of the slope of the production possibilities curve at any point:
A) gives the price of the good on the vertical axis that must be given up to attain an additional unit of the good on the horizontal axis.
B) is found by dividing the horizontal change by a vertical change.
C) gives the quantity of the good on the vertical axis that must be given up to produce an additional unit of the good on the horizontal axis.
D) gives the price of the good on the horizontal axis relative to the price of the good on the vertical axis.
Ans: C) gives the quantity of the good on the vertical axis that must be given up to produce an additional unit of the good on the horizontal axis.
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The return-to-entrepreneurship curve is:
A) horizontal. B) vertical. C) downward sloping. D) upward sloping.
According to economists, the fixed-price model of macroeconomic equilibrium depicts the modern economy most closely because it assumes that aggregate supply is independent of price
a. True b. False Indicate whether the statement is true or false
Exhibit 10-6 Aggregate supply curve
In Exhibit 10-6, when the economy moves from a GDP of $1,000 billion to a GDP of $1,100 billion,
A. higher wages will lower the cost of producing goods. B. real GDP and employment both increase, but only under conditions of constant prices. C. real GDP increases and employment decreases, but only under conditions of price level increases. D. real GDP and employment both increase, but only under conditions of price level increases.
As disposable income goes up, the:
A. average propensity to consume falls. B. average propensity to save falls. C. volume of consumption declines absolutely. D. volume of investment diminishes.