One of the most important forms of capital income is
A. wages.
B. profits.
C. rent.
D. depreciation.
Answer: B
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In a two-player simultaneous game where neither player has a dominant strategy,
A) there is never a Nash equilibrium. B) there is only one Nash equilibrium. C) the actual outcome is unpredictable. D) the actual outcome will not be a Nash equilibrium.
Which of the following statements reflect sound economic reasoning?
a. Foreign competition will reduce the wealth of Americans. b. If it is more economical to acquire a good through trade than by self-production, it makes sense to trade for it. c. If domestic production of a good will employ lots of people, the good should be produced domestically. d. Higher tariffs will increase the total volume of international trade.
Assume that a consumer purchases products A, B, and C in quantities such that the last dollar spent on each yields the same marginal utility and the consumer's income is totally spent. We can conclude that:
A) total utility is being minimized. C) marginal utility exceeds total utility. B) production costs are being minimized. D) total utility is being maximized.
If the marginal propensity to consume is 0.75, then the value of the tax multiplier is
A) -2.5.
B) -3.
C) 1.25.
D) 1.4.