The slope of the scatter diagram representing the relationship between consumption and disposable income in the United States is approximately
A. 1.10.
B. 0.30.
C. 0.50.
D. 0.90.
Answer: D
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Consider the above figure. At a price level of 150
A) total planned production exceeds total planned real expenditures. B) total planned real expenditures exceed total planned real production. C) the price level would rise. D) inventories of unsold goods decline.
The higher the exchange rate, the
a. the lower the dollar cost of imported goods and the higher the demand for foreign exchange. b. higher the dollar cost of imported goods and the lower the demand for foreign exchange. c. higher both the dollar cost of imported goods and the demand for foreign exchange. d. the lower both the dollar cost of imported goods and the demand for foreign exchange.
A decrease in the unemployment rate from 21 percent to 17 percent can be illustrated as: a. an inward shift of the production possibilities curve
b. an outward shift of the production possibilities curve. c. a movement down and to the right along the production possibilities curve. d. a movement from a point inside the production possibilities curve to a point closer to the production possibilities curve.
The mainstream view of macro instability is that:
A. changes in the money supply directly cause changes in aggregate demand and thus cause changes in real GDP. B. changes in investment shift the aggregate demand curve and thus cause changes in real GDP. C. bursts of innovation put the economy on an unsustainable growth path, eventually producing recession. D. changes in technology and resource availability are the two main sources of fluctuations of real GDP.