If an indifference curve is bowed in toward the origin, the marginal rate of substitution is
a. not likely to reflect the relative value of goods.
b. likely to be constant for all bundles along the indifference curve.
c. likely to be identical to the price ratio for each bundle along the indifference curve.
d. different for each bundle along the indifference curve.
d
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If the CPI is used as a cost of living index, incomes that are adjusted to reflect the changes in the CPI will
A) increase by more than the actual change in the cost of living. B) decrease by more than the actual change in the cost of living. C) increase by more than the actual change in quantities. D) decrease by more than the actual change in quantities. E) generally rise by about 2 percent a year because the standard of living generally rises by about 2 percent a year.
In 1910, 8.6 percent of American 17-year olds were high school graduates. By 1938, this figure _____
a. had fallen to 5 percent. b. equaled 15 percent. c. had risen to nearly 50 percent. d. had not changed appreciably.
If the spending multiplier is greater than 1.0, a $200 billion increase in autonomous investment will cause: a. equilibrium investment to increase by less than $200 billion
b. equilibrium investment to decrease by more than $200 billion. c. equilibrium real GDP demanded to increase by more than $200 billion. d. equilibrium real GDP demanded to decrease by less than $200 billion. e. equilibrium saving to decrease by more than $200 billion.
If the Fed wants banks to have more money to lend, it can
A. sell government securities. B. raise the reserve ratio. C. lower the reserve ratio. D. raise its discount rate.