A decrease in consumer spending can be expected to shift the aggregate expenditures curve ________.
A. downward and the aggregate demand curve leftward
B. upward and the aggregate demand curve rightward
C. upward and the aggregate demand curve leftward
D. downward and the aggregate demand curve rightward
Answer: A
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The measure used to determine whether two products are complements or substitutes is called the
A) price elasticity of supply. B) cross elasticity of demand. C) price elasticity of demand. D) income elasticity. E) substitute elasticity of demand.
The law of diminishing marginal utility explains why people and societies rarely make all-or-nothing choices
a. True b. False Indicate whether the statement is true or false
Assume that the uncovered interest parity condition holds. Also assume that the U.S. interest rate is greater than the U.K. interest rate. Given this information, we know that investors expect
A) the pound to depreciate. B) the pound to appreciate. C) the dollar-pound exchange rate to remain fixed. D) the U.S. interest rate to fall. E) none of the above
The law of diminishing marginal utility guarantees that demand curves will have positive slopes
a. True b. False Indicate whether the statement is true or false