In the Keynesian model, consumption
A. and saving are positively related to income.
B. and saving are negatively related to the real interest rate.
C. is positively related to the interest rate but negatively related to a temporary change in income.
D. is positively related to income but saving is not systematically related to either income or interest rates.
Answer: A
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Suppose India and France have the same PPF, shown in the figure above. Based on their current production points, which is India's most likely future PPF?
A) PPF1 B) PPF2 C) PPF0 D) either PPF0 or PPF1 E) None of the above because economic growth will not happen in India.
Generally speaking, protection from foreign competition benefits:
a. both domestic producers and foreign producers. b. both domestic consumers and foreign consumers. c. domestic consumers and foreign consumers. d. neither domestic producers nor foreign producers. e. domestic producers at the expense of domestic consumers.
Based on the information above, the non-employment rate is
A) 4%. B) 9.1%. C) 10%. D) 60%. E) 66%.
The efficiency wage is
A) lower than the market-clearing wage, to penalize shirking. B) higher than the market-clearing wage, to penalize shirking. C) lower than the market-clearing wage, to allow managers the resources to monitor shirking. D) higher than the market-clearing wage, to reward workers for informing on others who shirk. E) lower than the market-clearing wage, because of shirking done by managers.