The consumption function has a slope less than one because:
a. as disposable income increases, the real rate of interest will decline.
b. saving and consumption are equal at all levels of income.
c. as disposable income increases, consumption expenditures increase by an amount less than the increase in income.
d. as disposable income increases, consumption expenditures increase by an amount greater than the increase in income.
c
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It never occurred to Keynesians that they would have to choose between policies to control unemployment and policies to control inflation
Indicate whether the statement is true or false
Maude's labor-supply curve slopes upward if, for Maude,
a. consumption is a normal good. b. leisure is a normal good. c. the substitution effect on leisure exceeds the income effect. d. the income effect on leisure exceeds the substitution effect.
The idea of continuous economic growth as a "perpetual motion machine" best reflects the prediction of which growth theory?
A) no growth theory B) the classical growth theory C) the traditional growth theory D) the Keynesian growth theory E) the new growth theory
The president of which Federal Reserve bank is always a voting member of the Federal Open Market Committee?
A) Philadelphia B) Boston C) Chicago D) New York