Refer to the given diagram. The marginal propensity to consume is:
A. .2.
B. .8.
C. .4.
D. .3.
B. .8.
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One way the government can boost the economy out of a recession is:
A. with public announcements telling the public to save their money. B. by increasing government spending. C. by setting price ceilings on most goods so people can afford them. D. None of these will help an economy in recession.
Which of the following is NOT one of the main goals of monetary policy?
A. Controlling inflation B. Ensuring financial stability C. Smoothing out the business cycle D. Balancing the federal budget
A nonpolicy reason for the reduction in the natural rate of unemployment is the
A. expansionary nature of monetary policy. B. aging of the U.S. labor force. C. decline in interest rates. D. growing federal budget surplus.
Using the above table, at a price of $5 there will be a
A. surplus of 20 units. B. shortage of 20 units. C. shortage of 10 units. D. surplus of 10 units.