Suppose an increase in the price of rubber coincides with an advance in the technology of tire production. As a result of these two events, the demand for tires
a. decreases, and the supply of tires increases.
b. is unaffected, and the supply of tires decreases.
c. is unaffected, and the supply of tires increases.
d. None of the above is necessarily correct.
d
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"Universal banking" can lower the risk of participating financial institutions if
A) there is high correlation in the returns of the permitted activities. B) there is low correlation in the returns of the permitted activities. C) there are firewalls between all the permitted activities. D) none of the customers of the institution are federally insured.
If the marginal propensity to consume (MPC) is 0.8, the spending multiplier will be
A) 0.2. B) 1.25. C) 4.0. D) 5.0.
Of the curves displayed in the graph shown, graph B is most like to be the:
A. ATC curve. B. AFC curve C. AVC curve D. MC curve
This textbook is about microeconomics because it deals mainly with the behavior of variables such as:
A. economic sectors, the business cycle and monetary and fiscal policies. B. national output, interest rates, unemployment and inflation. C.individual economic units, such as consumers, firms, workers and investors D.national and international markets, exchange rates and economic treaties.