If we consider the equation PAE = A + bY the part of the equation that relates to autonomous sources of spending is:
A. PAE
B. Y
C. A
D. b
Answer: C
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In a demand-pull inflation, money wage rates rise because
A) a decrease in aggregate demand creates a labor shortage. B) an increase in aggregate demand creates a labor surplus. C) an increase in aggregate demand creates a labor shortage. D) a decrease in aggregate demand creates a labor surplus. E) an increase in aggregate supply creates a labor shortage.
Refer to Figure 2-9. Carlos Vanya grows tomatoes and strawberries on his land. His land is equally suited for growing either fruit. Which of the graphs in Figure 2-3 represents his production possibilities frontier?
A) Graph A B) Graph B C) Graph C D) either Graph A or Graph B E) either Graph B or Graph C
"Ceteris paribus" means
A) "invisible hand." B) "other things constant." C) "making all the necessary changes." D) "individual."
For most goods and most people, marginal utility probably
a. continues to increase as larger quantities are purchased. b. plummets after the first few units but soon begins to rise. c. declines as consumption increases. d. is negative after the first unit of a good is purchased. e. is positive and rising for most goods.