A change in taxes of a given amount shifts the consumption function vertically by ____ than that amount, because the marginal propensity to consume is ____
a. less; less than 1
b. greater; greater than 1
c. greater; always equal to 1.
d. less; equal to zero.
a
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It is possible to come up with a democratic social choice process that satisfies Arrow's axioms as long as we are willing to let go of the No Dictatorship axiom.
Answer the following statement true (T) or false (F)
The FOMC ________
A) meets four times a year to decide on how to conduct open market operations that influence the money supply B) meets six times a year to decide on how to conduct open market operations that influence the money supply and interest rates C) meets eight times a year to decide on how to conduct open market operations that influence the money supply and interest rates D) meets twelve times a year to decide on how to conduct open market operations that influence interest rates E) none of the above
A firm that sells its output and hires its labor in perfectly competitive markets
a. controls the price of its output, but accepts the wage rate it pays as given b. controls both the price of its output and the wage rate it pays c. controls the rate it pays, but accepts the price of its output as given d. accepts both the price of its output and the wage rate it pays as given e. controls the price of its output, the wage rate it pays, and its own output level
The bundling of mortgages together and the issuing of securities for their financing made it possible for investment banks to
a. reduce their exposure to risk in the event that the overall mortgage default rate rose. b. reduce the amount of capital required to back these bundled securities. c. build up large reserves so they would be able to meet their obligations even if the mortgage default rate rose substantially. d. quickly access funds to meet short-term debt obligations.