If the price of iPods rises 10 percent during a year when the level of average prices rises 3 percent, the relative price of iPods compared with other goods
A. Decreases.
B. Remains constant.
C. Increases.
D. More information is required to answer this question.
Answer: C
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Using Figure 1 above, if the aggregate demand curve shifts from AD2 to AD1 the result in the long run would be:
A. P4 and Y1. B. P4 and Y2. C. P5 and Y1. D. P5 and Y2.
The change reflected in the above figure might be a result of
A) a decrease in the real wage rate. B) an increase in the real wage rate. C) an increase in the money wage rate. D) a rise in the price level. E) a decrease in the money wage rate.
What would happen in the market for loanable funds if the government were to decrease the tax rate on interest income?
a. the supply of loanable funds would shift right and investment would increase. b. the supply of loanable funds would shift left and investment would decrease. c. the demand for loanable funds would shift right and investment would increase. d. the demand for loanable funds would shift left and investment would decrease.
Suppose that the government of Smallville spends? $2 trillion in 2018 and receives tax revenues of? $1.5 trillion in that same year. Which of the following is? TRUE?
a. Summerfield has a trade deficit of $0.5 trillion. b. Summerfield has a budget deficit of $0.5 trillion. c. Summerfield has a budget surplus of $0.5 trillion. d. Summerfield has a trade surplus of $0.5 trillion.