In the Keynesian aggregate expenditure model, the 45-degree line indicates:
a. amounts households plan to spend at each possible level of income.
b. amounts households plan to save at each possible level of income.
c. all income levels at which the planned spending of decision makers equals total output.
d. all income levels at which the marginal propensity to consume is one.
c
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If a person were in the 20% tax bracket and given the choice of a $500 credit or a $2500 deduction,
A. he would not care. They would constitute the same tax benefit. B. he would take the credit every time. C. he would not qualify for either. D. he would take the deduction every time.
The figure above shows the market for tires. According to the figure, the price elasticity of demand is ________ the price elasticity of supply
A) greater than B) equal to C) less than D) not comparable to E) More information is needed to determine if the price elasticity of demand is greater than, equal to, less than, or comparable to the price elasticity of supply.
Which of the following would be an advantage of a sole proprietorship?
a. ability to raise money by issuing stock b. the sharing of risk with other investors c. limited liability d. unlimited liability e. one person can make all decisions
A point inside the production possibilities curve may indicate that resources are not being used efficiently.
a. true b. false