In order to simplify the equation for the multiplier to its familiar, relatively simple form, we make use of the
a. assumption that increases in government purchases have no effect on consumer spending.
b. assumption that the feedback effects associated with changes in government purchases become negligible after two or three rounds of spending have occurred.
c. empirical evidence that points to a value of about 3/4 for the MPC.
d. fact that the multiplier effect is represented by an infinite geometric series.
d
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Even if the population declines, scarcity will still exist
Indicate whether the statement is true or false
A supermarket sells you a pound of coffee on the condition that you buy a gallon of milk. This is an example of
a. Bundling b. Tie in Sale c. Price Discounting d. Both a and b
As the market wage rate increases, it will exceed more individuals' reservation wage rates; this ensures the market supply of labor curve will be upward sloping
a. True b. False
It is correct to state that a society which is on its production possibilities curve is
A) underutilizing is resources. B) technologically inefficient. C) consuming too much output. D) fully utilizing its productive resources.