The Marginal Propensity to Consume is equal to:
(a) Total spending divided by total consumption.
(b) Total consumption divided by total income.
(c) Change in consumption divided by change in income.
(d) Change in consumption divided by change in saving.
Answer: (c) Change in consumption divided by change in income.
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Everything else held constant, a decrease in government spending ________ aggregate ________
A) increases; demand B) decreases; demand C) decreases; supply D) increases; supply
If the interest rate is 8 percent, $54 next year is worth __________ today
a. $62 b. $50.68 c. $50 d. $62 e. $4.32
Japanese employers tend to hire employees right out of college and train them for a lifetime job with the company. Over time they found that women often, but not always, married after a few years and left the company so they were not good training investments. Based on this experience, and despite the exceptions, firms stopped hiring any women for jobs that require substantial training. This
practice is called a. economic discrimination. b. statistical discrimination. c. compensating differentials. d. the substitution effect.
The production function is Q = K.4 L.6. The marginal rate of technical substitution is:
A. K-1 L-1. B. 3/2 K L-1. C. 3/2 K-1 L. D. K.6 L-.4.