Define subsistence level. What happens if the income in an economy exceeds the subsistence level in Malthus cycle?
What will be an ideal response?
The subsistence level is the minimum level of income per person that is generally necessary for the individual to obtain enough calories, clothing, and shelter to survive.
If the income in an economy exceeds the subsistence level, the fertility in the economy increases, which in turn increases the size of population of the economy.
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The demand for dollars in the foreign exchange market
A. Depends on U.S. demand for foreign goods and services. B. Depends in part on the foreign demand for U.S. goods. C. Is represented by a point in a diagram of foreign exchange supply and demand. D. Is the ratio of the dollars demanded to the amount of foreign currency supplied.
Briefly describe the potential negative effects of increasing government purchases rather than decreasing taxes during a recession.
What will be an ideal response?
Market economies are likely to suffer from recessions and inflation because the government plans all economic activity.
Answer the following statement true (T) or false (F)
Up to what amount would a risk-neutral gambler pay to enter a game where on the flip of a fair coin, if you call the correct outcome the payoff is $2,000?
A. Up to $2,000. B. Up to $1,000. C. More than $1000 but less than $2000. D. More than $1,500.