Why might a company use barter rather than money to make a transaction?
A. Money is economically efficient for large transactions, but barter is preferred for smaller transactions.
B. Money requires a coincidence of wants but barter is more direct.
C. Barter is generally more efficient than money exchanges.
D. Barter can enable two firms to trade when their cash flows are limited.
Answer: D
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Which of the following would explain why Josh's Limo Service might increase its demand for limo drivers?
A) an increase in demand for limo rides, resulting in a rise in the price of a limo ride B) a decrease in the demand for limo rides C) a fall in the price of a taxi ride D) a rise in the wage paid to limo drivers
A criticism of the monetarist autonomous spending variable is that
A) some types of autonomous spending do not affect aggregate demand. B) some types of autonomous spending affect aggregate demand before the spending occurs. Some types of autonomous spending affect aggregate demand when they occur. C) some types of autonomous spending affect aggregate demand only long after they occur. D) Keynesians do not think that autonomous spending affects aggregate demand.
The age-earnings profile predicts that earnings will peak at
A) the 35-40 age level. B) the 45-50 age level. C) the 60-65 age level. D) retirement.
If the marginal propensity to save (MPS) increased from 0.3 to 0.4, this would cause the multiplier effect to
A. increase. B. decrease. C. stay the same. D. None of these is correct.