What is the main cause of high inflation rates in middle and low income countries?
a. Citizens save most of their income lowering aggregate demand.
b. Citizens spend most of their income pushing up prices.
c. The government pays for its budget deficits by printing money.
d. The government pays for its budget surplus by printing money.
c. The government pays for its budget deficits by printing money.
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Along a linear consumption function,
A) the average propensity to consume rises with income, but the marginal propensity to consume falls with an increase in income. B) the marginal propensity to consume rises with an increase in income. C) the average propensity to consume falls with an increase in income. D) both the average propensity to consume and the marginal propensity to consume rise with an increase in income.
Which of the following statements about the social welfare function is not true?
a. It can be thought of as a set of indifference curves that depict the wealth of the entire society. b. It does not employ interpersonal utility comparisons. c. It is one possible method for evaluating the public interest/ d. It allows for the rankings of possible outcomes.
Which of the following illustrates government acting as a referee?
a. taxing high income persons b. enforcing contract provisions between buyer and seller c. buying new weapons for defense d. mailing checks to social security recipients e. collecting data on imports and exports
An economics professor points to a student in the front row and announces that "sitting in class is the thing you value most during this time period." Is the professor correct? Why or why not?