If a change is a Pareto improvement, then
A) we also achieve Pareto efficiency.
B) consumer surplus is maximized.
C) it also passes the cost-benefit test.
D) the distributional effect is likely to be regressive.
C
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A decrease in the reserve requirement
A) decreases the money supply, which leads to decreased interest rates and a rise in investment spending. B) increases the money supply, which leads to increased interest rates and a fall in investment spending. C) increases the money supply, which leads to decreased interest rates and a rise in investment spending. D) decreases the money supply, which leads to increased interest rates and a fall in investment spending.
Suppose the MPC is 0.60 . Assume there are no crowding out or investment accelerator effects. If the government increases expenditures by $200 billion, then by how much does aggregate demand shift to the right? If the government decreases taxes by $200 billion, then by how much does aggregate demand shift to the right?
a. $300 billion and $180 billion b. $300 billion and $300 billion c. $500 billion and $300 billion d. $500 billion and $500 billion
The concept of ________ is that the economic cost of using a factor of production is the alternative use of that factor that is given up
A) marginal cost B) opportunity cost C) normative economics D) entrepreneurship
Investments that are designed to match exactly the performance of a group of stocks like the Dow Jones Industrial Average or the S&P-500 are called:
A. Index funds B. Dividend funds C. Portfolio funds D. Capital gain funds