When the Federal Reserve System was established in 1913, its main policy goal was
A) keeping employment high. B) preventing bank panics.
C) encouraging strong economic growth. D) promoting price stability.
B
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When disposable income is $8 trillion, consumption expenditure is $5 trillion; when disposable income is $5 trillion, consumption expenditure is $3 trillion. The MPC is
A) (5 - 3 ) ÷ (8 - 5 ) = 0.667. B) (8 - 5 ) ÷ (5 - 3 ) = 1.333. C) (5/8 + 3/5 ) = 1.225. D) (5 + 3 ) ÷ (8 - 5 ) = 2.667. E) (5 + 3 ) ÷ (8 + 5 ) = 0.615.
Which of the following best describes the policy of the New Deal to combat the Great Depression?
(a) Taxation should be increased so as to eliminate the deficit in the federal budget. (b) Government spending should be reduced so as to give businesses confidence that the free enterprise system was not being replaced by big government. (c) The government should offset deficiencies in private spending with increased government spending in order to create jobs—any jobs. (d) Private enterprise should be replaced by government planning because the market system had failed to provide prosperity and economic growth.
When variable inputs are added to a fixed input
A) output increases. B) output can increase at an increasing rate. C) output can increase at a decreasing rate. D) all of these choices are possible.
Refer to Table 10.1. If the price of output is $2 per unit and the wage rate is $60, ________ workers should be hired.
A. five B. six C. seven D. eight