The MPC in the economy depicted in Figure 9.3
A. Decreases steadily as disposable income increases.
B. Equals 1.0.
C. Increases steadily as disposable income increases.
D. Is constant.
Answer: D
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Profits that are reinvested in a firm rather than paid to the firm's owners are called
A) dividends. B) retained earnings. C) corporate bonds. D) stock options.
The principal difference between economic profits for a monopolist and for a competitive firm is that:
a. monopoly profits create major problems of equity whereas competitive profits do not. b. competitive profits exist only in the short run whereas monopoly profits may exist in the long run as well. c. monopoly profits represent a transfer out of consumer surplus whereas competitive profits do not. d. monopoly profits are usually larger than competitive profits.
Economists say that a market where goods are not consumed by those valuing the goods most highly is
a. laissez-faire.. b. unequal. c. inefficient. d. rational.
The Banking Act of 1935 changed the name of the _______________ to the Board of Governors of the Federal Reserve System
A) Federal Open Market Committee B) Board of Monetary Affairs C) Central Bank Board D) Federal Reserve Board