Higher interest rates:
a) increase consumption and investment spending.
b) decrease consumption and increase investment spending.
c) decrease consumption and investment spending.
d) increase consumption and decrease investment spending.
Ans: c) decrease consumption and investment spending.
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Refer to Figure 9-3. What is the value of domestic producer surplus after the imposition of a quota?
A) $10.75 million B) $15.75 million C) $17.25 million D) $27.75 million
If the incentive to take advantage of a conflict of interest is high
A) removing the economies of scope that created the conflict may induce higher costs because of the decrease in the flow of reliable information. B) then the government must step in to remove the conflict. C) the costs of non-action in removing the conflict will always be higher than the cost of removing the conflict. D) firms will always step in and work to remove the conflict.
Given the information in Scenario 4.3, it would be correct to say that demand is:
A) infinitely elastic. B) elastic, but not infinitely elastic. C) unit elastic (Ep = -1). D) inelastic, but not completely inelastic. E) completely inelastic.
The principal factor determining velocity is the
a. level of income. b. frequency with which paychecks are distributed. c. frequency with which taxes are paid. d. growth rate of real output.