If disposable income were to fall from $6,000 to $5,000,
A. induced consumption would fall.
B. induced consumption would stay the same.
C. induced consumption would rise.
D. there is not enough information to determine whether induced consumption would rise, fall or remain the same.
A. induced consumption would fall.
You might also like to view...
When the domestic money prices of goods are held constant
A) a nominal dollar appreciation makes U.S. goods cheaper compared with foreign goods. B) a nominal dollar depreciation makes U.S. goods less appealing in foreign markets. C) a nominal dollar appreciation does not affect the prices of U.S. goods. D) a nominal dollar depreciation makes U.S. goods more expensive compared with foreign goods. E) a nominal dollar depreciation makes U.S. goods cheaper compared with foreign goods and a nominal dollar appreciation makes U.S. goods more expensive compared with foreign goods.
The original Keynesian economic theory states that
A) the short-run aggregate supply (SRAS) curve is always vertical. B) many prices would not decline even when aggregate demand decreases. C) wages tend to fall more quickly than the overall price level. D) the economy naturally self-regulates so as to reach full employment quickly.
How much is the percentage of income received by the highest quintile on line R?
Suppose that the nominal exchange rate between the U.S. dollar and the Canadian dollar is 0.75 U.S. dollars per Canadian dollar. If Canada's rate of inflation is 0 percent and the U.S. rate is 10 percent, then the real exchange rate for the U.S. dollar will
A) appreciate by about 9 percent. B) appreciate by 10 percent. C) depreciate by about 9 percent. D) depreciate by 10 percent.