A change in aggregate supply would be caused by a change in:
a. The price level
b. An aggregate supply determinant
c. The quantity of real output supplied
d. Aggregate demand
b. An aggregate supply determinant
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When households' marginal propensity to consume (MPC) increases, the size of the spending multiplier:
a. also increases. b. decreases. c. remains unchanged. d. reacts unpredictably.
Suppose Country A, a labor-abundant country, produces only wheat and cloth. The following equations illustrate the prices and costs of wheat and cloth in the country. The numbers indicate the amounts of labor and land needed to produce a unit of wheat and cloth. 'W' is the wage rate and 'r' is the rental rate of land.Price of wheat = 1w + 2rPrice of cloth = 2w + 1rIf the initial prices of wheat and cloth are $3 per unit then
A. the wage rate and the rental rate are $2 and $3, respectively. B. the wage rate and the rental rate are $1 and $2, respectively. C. both the wage rate and the rental rate are equal to $2. D. both the wage rate and the rental rate are equal to $1.
Refer to the information provided in Figure 5.2 below to answer the question(s) that follow.
?Figure 5.2Refer to Figure 5.2. If the price of a hamburger increases from $2 to $4, the price elasticity of demand equals ________. Use the midpoint formula.
A. -0.33 B. -2.0 C. -3.0 D. -5.0
Opportunity costs exist for
A. households but not businesses or governments. B. businesses but not households or governments. C. businesses and households but not governments. D. households, businesses, and governments.