The demand schedule shows that the price of a good and quantity demanded are directly related to each other
a. True
b. False
Indicate whether the statement is true or false
False
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Jodie has indifference curves for CDs and colas, with CDs on the vertical axis. The flatter her indifference curves are, the
A) smaller her average rate of substitution. B) larger her average rate of substitution. C) smaller her marginal rate of substitution. D) larger her marginal rate of substitution.
The observation that changes in an economic variable are unpredictable suggests that the relevant variable follows ________
A) a random walk B) tertiary unpredictability C) the life-cycle hypothesis D) the Tequila effect
Keynes noted that that one solution to a recession was increased government spending, and while it would be nice if the government could spend additional money on housing, roads, and other amenities, he also argued that if the government could not agree on how to spend money in practical ways, then
a. it should not spend the additional money. b. a trade-off would appear. c. the Phillips curve would shift. d. it should spend in impractical ways.
Contractionary fiscal policy is deliberate government action to influence aggregate demand and the level of real GDP through:
A. expanding and contracting the money supply. B. encouraging business to expand or contract investment. C. regulating net exports. D. decreasing government spending or increasing taxes.