Assume that households have positive wealth. As the interest rate ________, nonlabor income ________ and current consumption ________.
A. decreases; increases; decreases
B. decreases; decreases; decreases
C. increases; decreases; increases
D. increases; increases; decreases
Answer: B
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Starting from long-run equilibrium, a decrease in autonomous investment results in ________ output in the short run and ________ output in the long run.
A. lower; potential B. higher; higher C. higher; potential D. lower; higher
According to the principle of diminishing marginal utility, as an individual consumes more and more of a good or service, the total utility increases while the marginal utility decreases
Indicate whether the statement is true or false
The three major differences between tariffs and trade quotas are (1) __________________; (2) ________________; and (3) _________________.
Fill in the blank(s) with the appropriate word(s).
A firm that faces the duopolists' dilemma can avoid the dilemma by:
A. telling customers that it will match any competitor's price. B. undercutting its competitor's price. C. agreeing to join a cartel. D. always choosing its dominant strategy regardless of the other firm's action.