The normal market demand curve for money is
A. A downward-sloping demand curve, where more money is held at lower interest rates.
B. An upward-sloping demand curve, where more money is held when interest rates are higher.
C. A vertical demand curve, where the same amount of money is held regardless of the interest rate.
D. A horizontal curve at very high interest rates, where the quantity demanded changes but the interest rate is constant.
Answer: A
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Data on after-tax income and consumption spending for the Smith family are given in the table below.After-tax IncomeConsumption Spending$9,000$18,10014,00022,60019,00027,10024,00031,600Based on these data, the Smith family has a marginal propensity to consume of
A. 0.75. B. 0.8. C. 0.6. D. 0.9.
Which of the following explains why firms in competitive price-searcher and competitive price-taker markets will both have zero economic profits in the long run but a monopoly will not?
a. There is always more than one firm in competitive price-searcher and competitive price-taker markets. b. Both competitive price-searcher and competitive price-taker markets are characterized by firms producing identical goods, but a monopoly is not. c. In both competitive price-searcher and competitive price-taker markets, the barriers to entry are low; this is not true under a monopoly. d. A monopoly firm has a downward-sloping demand curve; firms in the other types of markets do not.
"The income elasticity of a good is positive if a consumer increases the total spending on that good as a result of an increase in its market price." Do you agree or disagree? Why?
What will be an ideal response?
The idea that it takes 90 percent of your time to clean up the last 2 percent of your house illustrates that
A. the marginal benefit of cleaning up is constant. B. the marginal cost of cleaning up slopes downward. C. the marginal benefit of cleaning up slopes upward. D. the marginal cost of cleaning up slopes upward.