The value of the marginal propensity to consume
a. can exceed 1.
b. is always between 0 and 1.
c. can be less than 0.
d. is always greater than 1.
b. is always between 0 and 1.
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Repurchase agreements are often used to
A) increase bank reserves permanently. B) increase bank reserves temporarily. C) reduce bank reserves permanently. D) reduce bank reserves temporarily.
Which of the following schools of thought believes that the major source of the macroeconomic problems are the disequilibria in the private labor and goods market?
a. Keynesians and new Keynesians b. Only monetarists c. Only new classical economists d. Monetarists and new classical economists e. Monetarists and Keynesians
An airline industry study recently reported, "Evidence is abundant that larger firms are not more efficient or less costly simply because they are larger. In fact, other things equal, the largest carriers tend to have a higher level of unit costs, possibly caused by the difficulties of managing an airline of large size." This means that
a. there are increasing returns to scale in the airline industry. b. the airline industry has constant returns to scale. c. the larger airlines are not profitable. d. airlines are experiencing decreasing returns to scale.
The fact that we are operating at a point inside a bowed out production possibilities frontier indicates there is
A. scarcity. B. increasing opportunity cost. C. unemployment. D. constant opportunity cost.