An increase in the price of butter is likely to cause the demand for:
A. butter to increase.
B. butter to d.
C. olive oil to increase.
D. olive oil to decrease.
Answer: C
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When the transactions costs involved in putting a project together exceed the difference in the value of land with the project completed and the value of the land without the project, the project should be undertaken
Indicate whether the statement is true or false
The opportunity cost of an action:
a. is equal to the marginal cost of an action b. is equal to explicit cost c. is equal to the next best alternative forgone d. is the total cost of an action
If the investment curve is relatively flat, the Keynesian conclusion is that the transmission mechanism has little effect on the economy
a. True b. False Indicate whether the statement is true or false
The major difference between the Keynesian model and the classical theory of employment is that
A. the interest rate will not always equalize savings and investment. B. not everything produced will necessarily be purchased. C. saving and investing are done by different people for different reasons. D. wages and prices are assumed to be flexible downwards.