Assume that the supply curve for a commodity shifts to the left and the demand curve shifts to the right, both by the same degree. Then, in comparison to the initial equilibrium, the new equilibrium will be characterized by:
A) a lower price and the same quantity. B) the same price and quantity.
C) a lower price and quantity. D) a higher price and the same quantity.
D
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Which of the following is NOT usually assumed about the effect of disposable income on aggregate consumer spending?
A) Consumer spending is at a higher level of disposable income. B) At low levels of disposable income, saving may be negative. C) Consumption is always less than disposable income. D) A rise in income leads to a less than proportionate rise in consumption.
If you real disposable income goes up by $1000 per week, and your real consumption spending goes up by $800 per week, you have an MPS of
A) 0.2. B) 0.8. C) 1.2. D) 1.0.
Which of the following is most likely to help promote the efficient use of resources and rapid economic growth?
a. high tariffs and imposition of other trade restrictions b. high marginal tax rates c. an open and competitive capital market d. high rates of inflation
If planned injections exceed leakages, output will
A. decrease. B. remain constant. C. increase. D. either increase or decrease.