Figure 10-5
In Figure 10-5, which graph best illustrates the situation of an economy with high unemployment that experiences an increase in investment spending?
A. (1)
B. (2)
C. (3)
D. (4)
Answer: C
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The upward slope of the supply curve reflects the:
A. principle of specialization in production. B. law of supply. C. fact that price and quantity supplied are inversely related. D. law of diminishing marginal utility.
In 2017, President Trump signed a major tax cut into law when the economy was:
A. near full employment. B. experiencing hyperinflation. C. was in a recession. D. experiencing zero unemployment.
The wage rate will fall and firms will increase employment to the point where MRP equals the new wage rate if
A. the demand for labor decreases. B. the demand for labor increases. C. the supply of labor increases. D. the supply of labor decreases.
Generally speaking, the greater the MPS, the:
A. Smaller would be the increase in income which results from an increase in consumption spending B. Larger would be the increase in income which results from an increase in consumption spending C. Larger would be the increase in income which results from a decrease in consumption spending D. Smaller would be the increase in income which results from a decrease in consumption spending