If the consumption schedule is a straight line, it can be concluded that the
A. APC is equal to the MPC.
B. MPC is constant at various levels of income.
C. MPC is zero.
D. APC is necessarily constant.
Answer: B
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Economic growth is determined by forces outside the control of the market system.
Answer the following statement(s) true (T) or false (F)
The figure above represents the competitive market for slices of key lime pie. When the price is $3, the total consumer surplus equals
A) $120. B) $90. C) $60. D) $0. E) None of the above answers is correct.
A game in which players collectively gain is known as a
A) zero-sum game. B) positive-sum game. C) negative-sum game. D) cooperative game.
Suppose the Fed's primary goal is price stability and it aims to keep the inflation rate at 2%. If the inflation rate rose above 2%, what should it do?
A) pursue an expansionary monetary policy B) pursue a contractionary monetary policy C) reduce the required reserve ratio D) impose a temporary ceiling on the federal funds rate