Suppose your tastes can be represented by the utility function 
. Your demand function for 
is
A.
.B.
.C.
D.
Answer: B
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Refer to the scenario above. If the local government has a progressive tax system, which family pays the largest amount as tax?
A) The first household B) The second household C) The third household D) The fourth household
Suppose Japan is currently running a current account surplus. The most effective way of eliminating this current account surplus would be to temporarily ________ government purchases and ________ the domestic money supply
A) increase; increase B) increase; decrease C) decrease; increase D) decrease; decrease
Clifford lives by the motto "Eat, drink and be merry today, for tomorrow doesn't matter." If today's consumption is measured on the horizontal axis and tomorrow's consumption is measured on the vertical axis, Clifford's indifference curves
A) are horizontal straight lines. B) are vertical straight lines. C) show decreasing utility as one moves upward. D) cannot be determined from the information given.
If the marginal propensity to consume is 0.75 and government spending decreases by $2,000 billion, what is the change in GDP?
a. -$2,000 billion b. -$8,000 billion c. $2,000 billion d. $1,500 billion e. $8,000 billion