In the basic closed-economy ISLM model, the goods market can be described by the
A) consumption function.
B) investment function.
C) government spending and tax.
D) goods market equilibrium condition.
E) all of the above.
E
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Assuming all else equal, the ________, the lower the nominal interest rate
A) lower the inflation rate B) higher the inflation rate C) lower the income tax rates D) higher the income tax rates
What are the main characteristics of high-income and low-income households?
What will be an ideal response?
Assume that all taxes are lump-sum, net exports = 0, and the marginal propensity to consume is 0.8. Then, if investment and taxes were each to fall by $100 million, the equilibrium level of income would
A) rise by $100 million. B) fall by $100 million. C) rise by $500 million. D) fall by $500 million.
An industry has 1000 competitive firms, each producing 50 tons of output. At the current market price of $10, half of the firms have a short-run supply curve with a slope of 1; the other half each have a short-run supply curve with slope 2
The short-run elasticity of market supply is A) 1/50 B) 3/10 C) 1/5 D) 2/5 E) none of the above