A reduction in the rate of depreciation will cause the discounted present value of expected profits to
A) decrease.
B) increase.
C) remain unchanged if the real interest rate increases by the same amount.
D) none of the above
B
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The discussion of Figure 2.2 in the text indicates that quantity demanded for most goods tends to increase as income rises. However, the quantity of bananas demanded in the U.S. tends to decrease as income rises
Under this condition, we expect that an increase in consumer income shifts the demand curve for bananas: A) rightward B) no shift. C) leftward. D) upward.
Which of the following statements is true when total spending equals total output?
a. Saving plus taxes equals investment plus government purchases. b. Output equals investment plus government purchases plus saving plus taxes. c. Output equals consumption spending plus investment plus government purchases plus saving plus taxes. d. Output equals consumption plus investment plus taxes. e. Saving plus investment equals taxes plus government purchases.
When a change in the price level leads to a change in the quantity of net exports demanded, it is called the:
What will be an ideal response?
Refer to the above table. Suppose the U.S. government (but not Europe) offers a $10 million subsidy?
What will be an ideal response?