In Country Z, the government simultaneously decreases its expenditures by $20 billion and decreases taxes by $20 billion. If the MPS is equal to 0.2, the government's action ________ real GDP by ________
A) decreases; $100 billion
B) decreases; $20 billion
C) decreases; $80 billion
D) has no effect on; $0
Ans: B) decreases; $20 billion
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If real wages fall:
A) consumer demand is likely to increase. B) employers are likely to hire more workers. C) the level of economic production will always increase. D) the level of economic production will always decrease.
Suppose Addison is a big fan of jazz music, and that he likes opera music very little. What would his family of indifference curves look like?
A. Negatively sloped, with higher levels of utility represented by indifference curves that are closer to the origin B. Positively sloped, with higher levels of utility represented by indifference curves that are closer to the origin C. Negatively sloped, with higher levels of utility represented by indifference curves that are farther from the origin D. Positively sloped, with higher levels of utility represented by indifference curves that are farther from the origin
Suppose that dental hygienists are unionized in the eastern region of the country but not in the western region. If the unionized workers in the eastern region abolished their unions, employment
a. and wages of dental hygienists in the eastern region would rise. b. of dental hygienists in the eastern region would rise, but wages of dental hygienists in the eastern region would fall. c. and wages of dental hygienists in the eastern region would fall. d. of dental hygienists in the eastern region would fall, but wages of dental hygienists in the eastern region would rise.
Using Figure 1.4, we know the production of 9 units of soda and 1 unit of pizza is 
A. impossible because we have the technology but do not have the resources. B. impossible because we have the resources but do not have the technology. C. possible, but there would be unemployment. D. possible, but only if all resources were fully employed.