When the economy enters an expansion of a business cycle, households become more optimistic about expected future disposable income. The increase in optimism leads to
A) a shift upward of the consumption function.
B) a movement downward along the consumption function.
C) no change in the level of consumption expenditures.
D) an increase in consumption expenditures.
E) a movement upward along the consumption function.
A
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If MSC = 20 + 0.75A, where MSC is in millions of dollars, and A is the percentage of mercury emissions abatement, then
a. the total social costs of abatement equal $184 million when A is 8 percent b. the TSC at an abatement level of 10 percent is $27.5 million c. a 40 percent abatement level is associated with MSC of $30 million and TSC of 20 million d. TSC cannot be determined at any abatement level
How are the nominal and real demands for money related to changes in the price level?
What will be an ideal response?
A favorable supply shock will cause inflation to
a. rise and shift the short-run Phillips curve right. b. rise and shift the short-run Phillips curve left. c. fall and shift the short-run Phillips curve right. d. fall and shift the short-run Phillips curve left.
Refer to the above figure. At demand curve D2, price equals ________ and economic rent equals ________.
A. OF; FHGO B. OE; KHG C. OE; EKGO D. OF; KHG