People will be likely to spend a higher percentage of any additional income when _____
a. they believe that the increase is permanent
b. they believe that the increase is temporary
c. the increase is large
d. the increase is small
e. interest rates on savings accounts are rising
a
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The value in one year of $25 invested today at an annual interest rate of 5 percent will be
A) $25.00. B) $26.25. C) $27.50. D) $30.00.
Perfect capital mobility mixed with floating exchange rates means that
A) fiscal spending is completely ineffective. B) monetary policy is completely ineffective C) neither fiscal nor monetary policy will be effective. D) both fiscal and monetary policies efficiencies will be maximized.
The difference between the value of what a firm sells and its cost of producing it is referred to as
a. gross private investment b. value added c. net exports d. value of product e. expenditure approach
It is increasingly clear that technological change is the only explanation for an expanding wage gap between high-skill and low-skill workers
a. True b. False Indicate whether the statement is true or false