A piece of evidence in favor the Keynesian model would be that
a. investment is very sensitive to changes in tax rates.
b. changes in aggregate income cause changes in investment, but not vice versa.
c. the aggregate price level is negatively correlated with income.
d. all of the above.
B
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The Solo Coal Mine is the only employer in the small town of Way out there. The market supply of coal miners is Qs = 0.02W - 400, where W is the annual wage of a coal miner and Q is the number of people who would accept employment as a coal miner. What is the coal mine's marginal expenditure when it hires 150 coal miners?
A. $35,000 B. $20,000 C. $10,000 D. $5,000
The demand for money for which the purpose is making unexpected purchases or meeting emergencies is considered to be part of
A) precautionary demand. B) transactions demand. C) asset demand. D) savings demand.
In an imaginary economy, consumers buy only sandwiches and magazines. The fixed basket consists of 20 sandwiches and 30 magazines. In 2006, a sandwich cost $4 and a magazine cost $2 . In 2007, a sandwich cost $5 . The base year is 2006 . If the inflation rate in 2007 was 16 percent, then how much did a magazine cost in 2007?
a. $1.87 b. $2.08 c. $2.32 d. $3.00
A. it can produce that good at a lower opportunity cost than its trading partner B. it can produce the good using fewer resources than its trading partner. C. it can benefit by restricting imports of that good. D. None of these.