If the marginal propensity to consume (MPC) is 0.8, the multiplier will be
A) 1. B) 5. C) 0.8. D) 4.
B
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According to the Taylor rule, the Federal Reserve raises the real interest rate as the output gap ________ or the inflation rate ________.
A. increases; decreases B. decreases; increases C. decreases; decreases D. increases; increases
To economists, scarcity means that
A) the number of people without jobs rises when economic times are bad. B) unlimited wants cannot be satisfied by the limited resources. C) limited wants cannot be satisfied by the unlimited resources. D) there can never be answers to the what, how or for whom questions. E) a person looking for work is not able to find work.
If all firms are identical, output demand shifts cannot cause changes in output price in the long run.
Answer the following statement true (T) or false (F)
The additional cost to a producer of hiring an additional unit of labor is called the marginal cost
Indicate whether the statement is true or false