If disposable income increases by $500 million, and consumption increases by $400 million, then the marginal propensity to consume is
A) 1.25. B) 0.8. C) 0.6. D) 0.4.
B
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An increase in currency held outside the banks is ________
A) a currency drain B) income C) a currency surplus D) wealth
In a general equilibrium model
A) all markets but one clear. B) there are no fluctuations. C) all prices are exogenous. D) all prices are endogenous.
Part of the decrease in real wages during the Civil War was due to deteriorating productivity because of ___
a. the inability of firms to replace machinery b. the need to use inexperienced workers c. the decline in coal production d. excessive days lost due to strikes
It is sometimes suggested that a floating exchange rate will adjust to reduce or eliminate any current account deficit. Explain why this adjustment would occur.
What will be an ideal response?