If policy makers desire a $30 increase in output and the consumption function is C = 100 + .75(Y-T), then they must
a. increase government spending by $8.
b. increase taxes by $10.
c. cut government spending and taxes by $10.
d. decrease taxes by $10.
C
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Which of the following statements is false?
a. In a competitive market, the price mechanism encourages conservation of a depletable resource. b. As the price of a depletable resource rises, its known reserves often increase. c. Prices of depletable resources have risen in the twentieth century primarily because resource producers have exercised monopoly or oligopoly power. d. Shortages of depletable resources occur primarily when governments or others interfere with the price mechanism.
This graph demonstrates the domestic demand and supply for a good, as well as a tariff and the world price for that good.
According to the graph shown, if the economy is operating under free trade, who would be opposed to a tariff?
A. Domestic producers B. Domestic consumers C. Foreign producers D. Both A and B would be opposed to a tariff.
If an industry has a Herfindahl index of 3,000, the contestable market model probably would predict that the industry would be more likely to have a:
A. competitive price. B. monopolistic price if there are no barriers to entry. C. competitive price if there are no barriers to entry. D. monopolistic price.
Output is determined in
A) the goods market and also influences money demand and the interest rate. B) the money market and also influences money demand and the interest rate. C) the goods market with no influence from the money market. D) the money market with no influence on the goods market.