A movement upward along the consumption function can be caused only by a(n)
a. increase in disposable income.
b. decrease in disposable income.
c. decrease in the price level.
d. increase in the price level.
a
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Based on the figure below. Starting from long-run equilibrium at point C, a tax increase that decreases aggregate demand from AD1 to AD will lead to a short-run equilibrium at point ________ and eventually to a long-run equilibrium at point ________, if left to self-correcting tendencies.
A. D; C B. D; B C. A; B D. B; C
At any point in time, a single bank can loan an amount equal to
A) its excess reserves. B) its required reserves. C) its government securities. D) the amount of loans the bank made in the past. E) its total reserves.
The above table shows some of the balance of payments accounts for Urland. What is Urland's balance in the official settlements account?
A) $405 billion B) $62 billion C) $99 billion D) $37 billion
Assume that the marginal propensity to consume equals 0.8, the income tax rate equals 0.3, and the marginal propensity to import equals 0.2. The marginal leakage rate is ________ and the size of the multiplier is ________
A) 0.70; 3.33 B) 0.60; 2.5 C) 0.64; 1.56 D) 0.50; 2.0