The economy is in equilibrium, TP = TE, and Real GDP is $2,000 billion. The MPC is 0.75, the multiplier is operative, and idle resources exist at each expenditure round. Autonomous investment spending falls by $10 billion. As a result, the TE curve shifts __________, inventory levels unexpectedly __________, business firms __________ the quantity of goods and services they produce, and Real GDP
__________ by __________.
A) downward; rise; decrease; falls; $7.5 billion
B) downward; fall; increase; rises; $40 billion
C) downward; rise; decrease; falls; $40 billion
D) upward; rise; decrease; falls; $40 billion
E) downward; fall; decrease; falls; $7.5 billion
C
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The figure above illustrates a linear demand curve. If the price rises from $6 to $8 demand is ________ and if the price falls from $8 to $6 demand is ________
A) elastic; elastic B) elastic; inelastic C) inelastic; elastic D) inelastic; inelastic
How has the growing popularity of factory outlet stores affected the market for clothing at retail department stores?
A) the supply curve for clothing at retail department stores shifts to the left. B) the demand curve for clothing at retail department stores shifts to the right. C) the supply curve for clothing at retail department stores shifts to the right. D) the demand curve for clothing at retail department stores shifts to the left.
If autonomous consumption is greater than zero and the marginal propensity to consume is greater than zero, but less than one, the consumption function will first be below and then above the 45 degree line
a. True b. False Indicate whether the statement is true or false
We derive the demand curve for X from indifference curves and a budget constraint by changing the
A. level of income. B. price of Y. C. price of X. D. consumers? preferences.