When marginal utility begins to diminish, total utility always diminishes
a. True
b. False
Indicate whether the statement is true or false
False
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For a fixed target real interest rate and target inflation rate, when inflation decreases, the Fed ________ interest rates, hence ________ short-run equilibrium output.
A. increases; increasing B. decreases; decreasing C. decreases; increasing D. increases; decreasing
When you use a debit card to purchase a pair of jeans, you are
A) creating a 30-day loan from your bank to the seller. B) creating a 30-day loan from the seller to your bank. C) giving your bank an instruction to transfer funds directly from your bank account to the store's bank account. D) creating an overnight repurchase agreement between your bank and the store.
If the marginal propensity to consume (MPC) is 0.80, and if policy makers wish to increase real GDP $200 billion, then by how much would they have to change taxes?
a. ?$240 million. b. ?$200 million. c. ?$180 million. d. ?$50 million.
If autonomous consumption decreases, which of the following is the most likely effect in the short run?
a. a decrease in output, an increase in money demand, and an increase in the interest rate b. an increase in output, a decrease in money demand, and a decrease in the interest rate c. a decrease in output, a decrease in money demand, and a decrease in the interest rate d. an increase in output, an increase in money demand, and a decrease in the interest rate e. an increase in output, an increase in money demand, and an increase in the interest rate