Refer to the graphs below. In Graph A, a decrease in the price level from P1 to P3 will lead to:
In the graphs below, QP refers to the economy's potential output level.
A. A decrease in profits, an increase in real output, and a decrease in the unemployment rate
B. A decrease in profits, a decrease in real output, and a decrease in the unemployment rate
C. A decrease in profits, a decrease in real output, and an increase in the unemployment rate
D. An increase in profits, an increase in real output, and a decrease in the unemployment rate
C. A decrease in profits, a decrease in real output, and an increase in the unemployment rate
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If the MPC increases in value, what will happen to the slope of the consumption function?
a. The slope will decrease and the consumption function will become flatter. b. The slope will decrease and the consumption function will become steeper. c. The slope will increase and the consumption function will become steeper. d. The slope will increase and the consumption function will become flatter.
Which of the following will shift the aggregate demand curve to the right?
A. Income taxes are raised. B. Business managers become pessimistic about the future. C. Consumers become pessimistic about the future. D. The government increases spending on education.
The upward slope of the supply curve reflects the:
A. law of supply. B. principle of specialization in production. C. fact that price and quantity supplied are inversely related. D. law of diminishing marginal utility.
Maximum total revenue occurs when
A. Price multiplied by quantity is 1.0. B. The absolute value of the price elasticity of demand is 1.0. C. The absolute value of the price elasticity of demand is 100.