Suppose people buy more of good 1 when the price of good 2 falls. These goods are
A) complements.
B) substitutes.
C) normal.
D) inferior.
A
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The value of the multiplier ________ as the marginal propensity to save decreases
A) decreases B) increases C) is constant D) becomes negative
The deadweight loss from a tax is called the
A) marginal benefit of the tax. B) marginal cost of the tax. C) excess burden of the tax. D) net gain from taxation. E) net loss from taxation.
Which of the following is not a limitation to monetary policy? a. The fact that fiscal policy is sometimes at odds with monetary
b. The world has become global in all markets including financial markets, and the Fed does not have control over international banks or non-member banks. c. Because the Federal Reserve System is made up of twelve branches, it is essentially very difficult to get a decision enacted by the Board of Governors. d. Monetary policy has to be carried out through the commercial banking system.
If other factors remain? unchanged, technological progress in producing good A definitely will lead to
A) an increase in the market clearing price of good A and a decrease in the equilibrium quantity of good A.
B) an increase in both the market clearing price and the equilibrium quantity of good A.
C) a decrease in the market clearing price of good A and an increase in the equilibrium quantity of good A.
D) a decrease in both the market clearing price and the equilibrium quantity of good A.