If the price level in an economy increases, other things constant, consumption spending is likely to _____
a. increase because real income increases
b. decrease because real income increases
c. increase because the real value of wealth increases
d. decrease because the real value of wealth decreases
e. increase because nominal income increases
d
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In the above figure, the equilibrium interest rate is ________ and the equilibrium quantity of money is ________ trillion
A) 4 percent; $1.2 B) 8 percent; $1.2 C) 4 percent; $0.6 D) 8 percent; $0.6 E) 0 percent; $1.2
Refer to Figure 5-8. Suppose the emissions reduction target is currently established at 8 million tons. What is the area that represents the cost of eliminating an additional 1 million tons?
A) A + B B) A + B + C C) B + C D) A
The supply-side economists expect that a cut in the marginal income tax rate, with lost revenues made up by a cut in government spending, would
a. increase output. b. decrease output. c. leave output unchanged. d. affect output but the direction of the effect is uncertain.
If Sarah decides not to hit Tom, what would Tom's best response be
a. Tell b. Not tell c. Run d. Hide