Which national income account should be examined to discover trends in the after-tax income that people have to save and spend?
A. Gross domestic product (GDP).
B. Personal income (PI).
C. National income (NI).
D. Disposable personal income (DI).
Answer: D
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An increase in the price level means that
A) long-run aggregate supply has increased. B) monetary policy has been contractionary. C) the value of the dollar has increased. D) the purchasing power of money has fallen.
In 2007 and 2008, the sharp increase in the price of soybeans reflected primarily
A. the increased demand for corn needed to produce ethanol. B. an unseasonably warm spring in the soybean-producing states of Indiana, Illinois, and Iowa. C. government cash subsidies to soybean producers per ton harvested. D. increased use of advanced fertilizers by soybean producers.
Policy initiatives typically associated with "supply-side economics" would include
A. increases in the minimum wage. B. reduced minimum reserve requirements. C. increased spending for national defense. D. investment tax credits.
If the long-run supply curve of a purely competitive industry slopes upward, this implies that the prices of relevant resources:
A. will fall as the industry expands. B. are constant as the industry expands. C. rise as the industry contracts. D. rise as the industry expands.