Suppose the price of soda is $2 each and the price of a pizza slice is $4 each. David maximizes his utility by buying only sodas and pizza. He buys 5 sodas and 10 slices of pizza. If the price of a soda increases to $3 each, David will
A) decrease the number of sodas bought and the demand curve for sodas will shift leftward.
B) decrease the number of sodas bought and move along the demand curve for soda.
C) buy more pizza and move along the demand curve for pizza.
D) buy less pizza and the demand curve for pizza will shift leftward.
B
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Low stock market prices might ________ consumers willingness to spend and might ________ businesses willingness to undertake investment projects
A) increase; increase B) increase; decrease C) decrease; decrease D) decrease; increase
Using Figure 1 above, if the aggregate demand curve shifts from AD1 to AD2 the result in the short run would be:
A. P1 and Y2. B. P3 and Y1. C. P2 and Y2. D. P2 and Y3.
The time it takes for a particular monetary policy to change income is called the _____
a. recognition lag b. data lag c. reaction lag d. effect lag e. action lag
If the demand for computers increases as consumers' incomes rise, then computers are:
A. a complementary good. B. an inferior good. C. a substitute good. D. a normal good.