The change in consumption divided by a change in income is defined as:
a. the marginal propensity to consume.
b. autonomous consumption.
c. the consumption function.
d. Keynes' absolute income hypothesis.
e. transitory consumption.
a
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Suppose that when the price of a 16 oz. to-go cup of gourmet coffee is $4.25, students purchase 750 cups per day. If the price decreases to $3.75 per cup, which of the following is the most likely outcome?
a. Students would purchase fewer than 750 cups per day. b. Student would continue to purchase 750 cups per day. c. Students would purchase more than 750 cups per day. d. We do not have enough information to answer this question.
If a perfectly competitive firm faces a market price of $3 per unit, and it decides to produce 30,000 units, the market price will likely:
A. stay the same. B. increase. C. increase initially and then decrease. D. decrease.
Successive downward movements along the demand curve for the product of a monopolist always generate successive
A) increases in the monopolist's marginal revenue. B) increases in the monopolist's average total costs. C) decreases in the additional per-unit costs incurred by the monopolist. D) decreases in the additional per-unit revenues earned by the monopolist.