If autonomous consumption is greater than zero and the marginal propensity to consume is greater than zero, but less than one, the consumption function will first be below and then above the 45 degree line
a. True
b. False
Indicate whether the statement is true or false
False
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A price ceiling is only effective if it is above the market equilibrium.
Answer the following statement true (T) or false (F)
The table above gives the demand schedule for peas. Between point C and point D, the price elasticity of demand is
A) elastic. B) unit elastic. C) 0.75. D) 3.00.
If initially the money supply is $2 trillion, velocity is 5, the price level is 2, and real GDP is $5 trillion, a fall in the money supply to $1 trillion
A) reduces real GDP to $2.5 trillion. B) causes velocity to rise to 10. C) decreases the price level to 1. D) decreases the price level to 1 and decreases velocity to 2.5.
A financial market where economic agents meet in one central location is known as ________
A) an over the counter market B) an exchange C) a bond market D) a money market