The average propensity to consume
A. is C divided by disposable income.
B. is a measure of the additional C generated by additional disposable income.
C. is negative at very low income levels.
D. varies directly with disposable income: as disposable income rises, the APC rises.
A. is C divided by disposable income.
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Under the rational expectations hypothesis, if wages adjust rapidly to new information about intended policy actions, monetary policy can have an effect
A) in the long run, but not the short run. B) only in the short run and only if the policy is unanticipated. C) in both the short and the long run. D) only in the long run and only if the policy is fully anticipated.
If the price of potatoes is reduced, consumers likely buy
A. significantly more potatoes. B. significantly fewer potatoes. C. roughly the same quantity of potatoes. D. an unknown quantity of potatoes; in this situation, consumers’ actions cannot be predicted.
The long-run supply curve for a constant-cost perfectly competitive industry is
a. a ray from the origin at a 45-degree angle b. perfectly inelastic c. somewhat inelastic d. perfectly elastic e. declining
If U.S. real GDP grew from $12 trillion one year to $12.7 trillion the next, the annual growth rate would be:
A. 5.8 % B. 94.4 % C. 105.8 % D. 5.5 %