If the nominal money supply grows 10%, the inflation rate is 6%, and the income elasticity of money demand is 1.0, then real income growth equals
A) 1%.
B) 2%.
C) 3%.
D) 4%.
D
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If it is not possible to increase the output of one good without decreasing the output of the other, when there are only two goods, then
A. this situation would describe a point on a production possibilities frontier for the producer. B. the outcome can be described as efficient. C. there is no unemployment of resources. D. All of these outcomes are correct.
The slope of the total revenue curve equals
a. marginal revenue, which equals price for a perfectly competitive firm b. marginal revenue, which is greater than price for a perfectly competitive firm c. marginal revenue, which is less than price for a perfectly competitive firm d. average revenue, which is greater than price for a perfectly competitive firm e. average revenue, which is less than price for a perfectly competitive firm
The law of diminishing marginal utility guarantees that demand curves will have positive slopes.
Answer the following statement true (T) or false (F)
Which of the following would increase GDP?
a. You buy 100 shares of Wal-Mart stock. b. Your car is destroyed by a fire, and you purchase a two-year-old car to replace it. c. Your car is damaged by a fire, and you hire a mechanic to repair it. d. Your car is damaged by a fire, and you reduce the number of hours you work to repair the car yourself.