Using the standard 45-degree line diagram, how does an increase in autonomous consumption effect the expenditure schedule?
a. It shifts the expenditure schedule downward.
b. It shifts the expenditure schedule upward.
c. It increases the slope of the expenditure schedule.
d. It decreases the slope of the expenditure schedule.
b
You might also like to view...
Which of the following does not happen when new firms enter a monopolistically competitive industry? a. The demand curve for each of the existing firms will fall
b. The demand curve for each of the existing firms will move inward. c. The demand curve for each of the existing firms will becomes relatively more elastic. d. The demand curve for each of the existing firms will shift to the right.
You put money into an account and earn a real interest rate of 4 percent. Inflation is 2 percent, and your marginal tax rate is 25 percent. What is your after-tax real rate of interest?
a. 1.5 percent. b. 2.5 percent. c. 5.0 percent. d. 4.5 percent.
If total spending is less than the value of total output, firms
A. may decide to cut prices. B. may increase production levels. C. will tend to raise prices. D. will notice inventories falling.
Suppose the money supply is set to grow at 12%, real GDP grows at 4%, and the nominal interest rate on Aaa corporate bonds is 10%
Using the quantity theory of money and the Fisher equation, the expected real interest rate on Aaa corporate bonds should average A) -2%. B) 2%. C) 6%. D) 7%.