Autonomous consumption is 700 and the marginal propensity to consume is 0.6. Calculate the average propensity to save when disposable income is (a) 10,000, (b) 12,000, and (c) 15,000
What will be an ideal response?
(a) 0.33; (b) 0.342; (c) 0.353
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The impact of a change in taxes on income is likely to be less than the effect resulting from a change in government spending since ________
A) the federal government typically operates in a deficit situation B) exports and imports can only assume positive values, but net exports can be positive or negative C) changes in the supply of money will be necessary if government spending is increased D) changes in taxes exert an indirect impact on total spending through changes in consumption
Answer the following statements true (T) or false (F)
1) If the market price is $2 and a perfectly competitive firm is producing 1,000 units and the marginal cost to produce the 1,000th unit is $2, the difference between marginal revenue and marginal cost (MR - MC) is zero. 2) Overexpansion can bankrupt a perfectly competitive firm. 3) If the market price is $3 and a perfectly competitive firm is producing 1,400 units and the marginal cost to produce the 1,400th unit is $2, the difference between marginal revenue and marginal cost (MR - MC) is zero. 4) If the market price is $1 and a perfectly competitive firm is producing 1,500 units and the marginal cost to produce the 1,500th unit is $2, the difference between marginal revenue and marginal cost (MR - MC) is negative. 5) If the market price is $4 and a perfectly competitive firm is producing 1,500 units and the marginal cost to produce the 1,500th unit is $3.50, the difference between marginal revenue and marginal cost (MR - MC) is negative.
By adding internal costs to external costs, we determine the total
A) private cost. B) social cost. C) psychological cost. D) marginal cost.
Which of the following statements is true for a given level of output?
A. Long-run average cost will always be greater than or equal to short-run average cost. B. Long-run average cost and short-run average cost will be equal because the firm will use different input combinations in each period. C. Long-run average cost will usually be greater than short-run average cost because more output is produced over the long run. D. Long-run average cost will always be less than or equal to short-run average cost.