Pete consumes two goods, rice and fish. When the price of fish rises, he consumes less fish. When the price of rice rises, he consumes more rice. For Pete,
a. fish is not a Giffen good but rice is.
b. rice is not a Giffen good but fish is.
c. both fish and rice are normal goods.
d. both fish and rice are Giffen goods.
a
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In the Classical model, an increase in saving will result in saving being __________ than investment which will cause the interest rate to __________
A) greater; rise B) greater; fall C) less; rise D) less; fall
In general, a formula that a central bank uses to set interest rates in response to changing economic conditions is called a
A) rate-of-return equation. B) Taylor rule. C) central bank reaction function. D) market adaptation identity.
If a firm takes the wage as given, then the supply curve of labor to that firm is
A) horizontal. B) vertical. C) upward sloping. D) downward sloping.
A utility-maximizing consumer is currently spending all of his/her income on two products, A and B. The MU of the last unit of A consumed is 50, the price of A is $25, and the price of B is $10 . The MU of the last unit of B consumed is:
a. 50. b. 5. c. 2. d. 20. e. cannot determine from this limited information