If disposable income rises by $100 billion, we can expect that consumers will
A. increase their saving by $100 billion.
B. increase their spending by $100 billion.
C. increase their spending by more than $100 billion.
D. increase their spending by less than $100 billion.
Answer: D
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Refer to Figure 7.1. In this case, the property rights belong to
A) Angus. B) Dudley. C) no one. D) both Angus and Dudley.
Which of the following statements correctly describes perfectly competitive market equilibrium?
A) There is always excess supply or excess demand when the market is in equilibrium. B) Multiple equilibriums are possible for a given set of demand and supply curves. C) Government intervention is necessary for the market to reach equilibrium. D) Any deviation from equilibrium is automatically restored.
Perfect price discrimination:
A. minimizes producer surplus. B. maximizes consumer surplus. C. requires each customer to pay exactly his or her willingness to pay. D. is not efficient.
Suppose that an economy's output does not change from one year to the next, but the price level doubles. What happens to real GDP?
A. Real GDP doubles B. Real GDP is halved C. Real GDP doesn't change D. There is not enough information to determine what happens to real GDP