Which of the following statements is true concerning the consumption function?
a. It slopes upward.
b. Its slope equals the MPC.
c. It represents the direct (positive) relationship between consumption spending and the level of real disposable income.
d. If the consumption function lies above the 45-degree line then saving is positive.
e. All of these.
e
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We can explain the paradox of value as follows: The consumer surplus from water, which is cheap, is ________ than the consumer surplus from gold, which is expensive; the total utility from gold is ________ than the total utility from water; and the
marginal utility per dollar spent on water ________ the marginal utility per dollar spent on gold. A) greater; less; equals B) smaller; less; equals C) greater; greater; greater than D) less; greater; greater than
From a purely economic point of view, discrimination is established if: a. black teenagers earn more than white teenagers do
b. all factors are earning an amount equivalent to their marginal revenue product. c. women earn less than men do. d. equivalent factors earn different payments for equal contributions to output.
According to the? input-substitution effect, an increase in the wage ? increases decreases the quantity of labor per unit of ? output input ?, so the quantity of labor demanded ? decreases increases .
According to the? input-substitution effect,
an increasean increase
in the wage
?
increases
decreases
the quantity of labor per unit of
?
output
input
, so the quantity of labor demanded
?
decreases
increases
.
In the medium run, a tax cut that causes an increase in the budget deficit will affect which of the following?
A) the level of output but not its composition B) both the level and composition of output C) only the composition of output D) only the price level E) none of the above