If everyone in an economy buys and sells goods at market-wide prices:
A. people will pay the same prices, so everyone's marginal rate of substitution will be the same.
B. people will pay the same prices, but will have different marginal rates of substitution.
C. people will pay different prices, but will have the same marginal rates of substitution.
D. people will pay different prices and therefore will have different marginal rates of substitution.
A. people will pay the same prices, so everyone's marginal rate of substitution will be the same.
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Refer to the scenario above. Based on the given information, we can conclude that the market for used cell phones in Barylia:
A) has asymmetric information. B) is perfectly competitive. C) is monopolistically competitive. D) has only one seller.
If the MPC = 0.8, an increase in investment spending from $35 billion to $38 billion will increase real GDP by
A) $3 billion. B) $3.75 billion. C) $15 billion. D) $24 billion.
Over the last three decades the "college premium" has ________ because of ________.
A. increased; technological advances B. decreased; technological advances C. increased; racial and gender discrimination D. decreased; laws that prohibit discrimination
When the Fed buys bonds from the public, it
A. Increases the flow of reserves to the banking system. B. Decreases the money supply. C. Decreases the discount rate. D. Decreases the flow of reserves to the banking system.