The assumption that individuals will not intentionally make decisions that will leave them worse off is known as
A. the rationality assumption.
B. a model or theory.
C. macroeconomic analysis.
D. microeconomic analysis.
Answer: A
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Induced expenditures are defined as that part of
A) autonomous expenditure that responds to changes in real GDP. B) real GDP that does not respond to changes in aggregate expenditure. C) aggregate expenditure that responds to changes in real GDP. D) aggregate expenditure that does not respond to changes in real GDP. E) autonomous expenditure that does not respond to changes in real GDP.
Checks are NOT money because they
A) are issued by banks, not by the government. B) are merely instructions to transfer money. C) have value in exchange but little intrinsic value. D) are not backed by either gold or silver.
A firm's accounting profit is measured as
A) operating expenses minus revenue. B) revenue minus operating expenses and taxes paid. C) revenue plus operating expenses minus taxes paid. D) net worth minus economic profit.
Assume that the demand curve for a commodity is represented by the equation Q = 25 - 1.3P. Calculate the change in total spending for this commodity when price falls from $4.50 to $4.20
a. Total spending rises by $4.11. b. Total spending declines by $4.11. c. Total spending declines by $8.20. d. Total spending rises by $8.20.