At equilibrium GDP, aggregate demand _______ aggregate supply and savings _______ investment.
A. is equal to; is equal to
B. is not equal to; is not equal to
C. is equal to; is not equal to
D. is not equal to; is equal to
A. is equal to; is equal to
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In 2015, Smileytown consumed 12,000 gallons of mouthwash. In 2016, mouthwash consumption rose to 17,000 gallons. Calculate the percentage change in mouthwash consumption
A) 17.2% B) 29.4% C) 41.7% D) 70.6%
Checking exchange rates, you find $1 equals 0.75 euros. Then the price of 1 euro is
A) $0.25. B) $0.75. C) $1.33. D) $4.30.
Which of the following will cause the demand for loanable funds to increase?
A. Households increase their rate of savings. B. The expected rate of return increases. C. The cost of funds increases. D. The expected profitability of a project declines.
Consider a company town where the ABC Corporation is the only employer. Assume ABC sells its output in a purely competitive market. The city council is considering a proposal to lower the minimum wage from its current level of W2 to W1, as shown in the graph above. Given the marginal revenue product of labor (MRP), labor supply (SL), and marginal cost of labor (MRC) curves, this policy would:
A. Increase employment from L1 to L2
B. Increase employment from L1 to L3
C. Reduce employment from L4 to L3
D. Reduce employment from L1 to L0