The absolute value of the slope of the budget line is:
A. the ratio of the marginal utility of one good to the marginal utility of the other good.
B. the ratio of the marginal utility of one good to the price of the other good.
C. the ratio of the price of one good to the price of the other good.
D. dependent on consumer income.
Answer: C
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Which of the following will cause the investment function to shift upward?
a. A decrease in government subsidies to businesses b. An increase in business profits c. A decline in capacity utilization d. Expectations of higher business taxes e. An increase in the market rate of interest
We wouldn't have to make choices if wants were not insatiable
Indicate whether the statement is true or false
The catch-up effect refers to the idea that
a. saving will always catch-up with investment spending. b. it is easier for a country to grow fast and so catch-up if it starts out relatively poor. c. population eventually catches-up with increased output. d. if investment spending is low, increased saving will help investment to "catch-up."
Inflation
A) is a continuing decline in the general level of prices of goods and services. B) implies that the number of people unemployed has risen. C) reduces the purchasing power of the dollar. D) is an increase in the price of a single good or service.