A college student decides to spend the afternoon watching three movies rented from Red Box. The cost of each movie is $1. The student was willing to pay $4 to rent each of the first two movies and $2 to rent the third movie. What was the marginal benefit received by the student when renting the 1st movie?
A. $4
B. $8
C. $1
D. $2
Answer: A
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A horizontal merger
a. combines similar firms that serve separate markets. b. combines firms that produce similar products. c. enables a company to control each stage of the production process: from raw materials to the final marketing of the product. d. enables similar firms to form a cartel.
Assume the marginal propensity to consume (MPC) is 0.75 and the government increases taxes by $250 billion. The aggregate demand curve will shift to the:
a. left by $1,000 billion. b. right by $1,000 billion. c. left by $750 billion. d. right by $750 billion.
Direct expenditure offsets are
A. the discretionary changing of government expenditures to achieve a higher employment level. B. the decrease in spending in the private sector in areas in which the government is competing. C. the same as the Ricardian equivalence theorem. D. the decrease in planned investment that occurs as the result of an increase in interest rates.
Real investment tends to be
A) procyclical and less variable than real GDP. B) procyclical and more variable than real GDP. C) countercyclical and less variable than real GDP. D) countercyclical and more variable than real GDP.