Suppose that we are currently at point b in Figure 14.1. An increase in the price level will result in a:
A. shift in the AD curve from AD1 to AD2.
B. shift in the AD curve from AD1 to AD0.
C. movement from point b to point a.
D. movement from point b to point c.
Answer: C
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In a simple economy (no government), the vertical distance between the consumption function and the expenditure schedule measures
A. undesired inventory depletion. B. planned investment C. undesired investment. D. unintended investment.
Which of the following is an example of money?
A) currency inside the banks B) currency in your wallet C) credit card used as a payment for a good or service D) a debit card E) checks written as payment for a good or service
Explain the difference between a firm's revenue and its profit
What will be an ideal response?
An increase in taxes will ________ consumption spending, and a decrease in transfer payments will ________ consumption spending
A) decrease; increase B) decrease; decrease C) increase; decrease D) increase; increase