If the marginal propensity to consume is 0.5 and disposable income decreases by $10,000 . by how much will consumption spending decrease?
a. $10,000
b. $500
c. $50
d. $5,000
e. $9,524
D
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A technological improvement lowers the cost of producing corn. As a result, the price of a pound of corn ________ and the quantity of corn ________
A) rises; increases B) rises; decreases C) falls; increases D) falls; decreases E) falls; does not change
Which of the following are NOT assets on the Fed's balance sheet?
A) discount loans B) U.S. Treasury deposits C) cash items in the process of collection D) U.S. Treasury bills
In the recent Global Economic Crisis, all of the following are causes that pushed the IS curve to the left EXCEPT
A) the negative wealth effect from the collapse of the housing bubble. B) the end of cash-out mortgage refinancing. C) growing unwillingness of banks and nonbank financial institutions to grant loan. D) slow and minimal response of the U.S. government.
Initially a firm pays a wage and gets an output per worker which are given index numbers of 1.00. Five possible 5 percent increases in the wage and the accompanying output per worker are as follows:
1.05 and 1.09, 1.10 and 1.17, 1.15 and 1.24, 1.21 and 1.28, 1.27 and 1.31. What is the efficiency wage? A) 1.05 B) 1.10 C) 1.15 D) 1.21 E) 1.27