If saving equals $200 when real disposable income equals $1,000, the break-even income is
A) less than $1,000.
B) greater than $1,000.
C) equal to $1,000.
D) equal to $1,200.
A
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When interest rates are free from central bank manipulation, and fall due to an increase in household savings, this
A) provides an incentive for government to create a budget surplus. B) sends a "green light" signal for businesses to increase investment. C) has little impact on the macroeconomy. D) creates a "cluster of errors" and an inevitable recession.
In Figure 4-9 above, suppose LMA shifts to LMB. The distance from points A to L tells us
A) the change in income given zero interest responsiveness of Ap. B) the change in income resulting from the interest rate falling to its value at point B?. C) how much the money supply increased in producing the LM shift. D) the change in income that by itself raises the demand for money by as much as the money supply rose.
A good may be inferior at some income levels and normal at others
What will be an ideal response?
Normative economic statements refer to what should be
a. True b. False