The quantity of good M is measured along the vertical axis, and the quantity of good N is measured along the horizontal axis. If the prices of both goods M and N declines by 50% each, then the budget line
A) shifts inward to the left by 50%.
B) shifts outward to the right by 50%.
C) shifts outward to the right by 100%.
D) rotates clockwise by 180 degrees.
Answer: C
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If a policymaker wants to stimulate the economy, a ________ would be preferable to a ________
A) lower-valued multiplier; higher valued multiplier B) high MPS; low MPS C) low MPC; high MPC D) high MPC; low MPC
As people have more time to adjust to changes in a good's price,
A) the demand curve will become less elastic. B) the supply curve will become less elastic. C) both the demand and supply curves will become less elastic. D) both the demand and supply curves will become more elastic.
A nation can produce two products: tanks and autos. The table below is the nation's production possibilities:
Refer to the above table. The total opportunity cost of three units of tanks is:
A. 6 units of tanks
B. 350 units of autos
C. 650 units of autos
D. 1000 units of autos
The expected level of shirking or opportunistic behavior by an agent:
A. is always zero. B. is always less than zero. C. can always be determined accurately. D. is always greater than zero.