Fear of a major recession causes stock prices to fall, everything else held constant, which in turn causes consumer spending to
A) increase.
B) remain unchanged.
C) decrease.
D) cannot be determined.
C
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If autonomous consumption is greater than zero and the marginal propensity to consume is greater than zero, but less than one, the consumption function will first be below and then above the 45 degree line
a. True b. False Indicate whether the statement is true or false
Heuristics economize on the mental capabilities of people
Indicate whether the statement is true or false
The phrase “price taker” can be associated most closely with ______.
a. a monopolistic demand curve b. a downward sloping demand curve c. an inelastic demand curve d. a perfectly elastic demand curve
Suppose that Figure 7.5 shows an industry's market demand, its marginal revenue, and the production costs of a representative firm. If the industry was perfectly competitive, it will produce a quantity of ________ and charge a price of ________.
A. 35; $65 B. 50; $50 C. 70; $30 D. There is not sufficient information.