The marginal propensity to consume is defined as the:
A. fraction of total income not spent on consumption.
B. proportion of any change in income that is spent on consumption.
C. fraction of total income spent on consumption.
D. fraction of a change in income that is saved.
Answer: B
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Which of the following items would be considered scarce?
A) water B) diamonds C) potato chips D) All of the above are scarce.
Exhibit 2-9 Production possibilities curve
Which of the following moves from one point to another in Exhibit 2-9 would represent an increase in economic efficiency?
A. Z to W. B. W to Y. C. W to X. D. X to Y.
Refer to the information provided in Figure 25.1 below to answer the question(s) that follow.
Figure 25.1Refer to Figure 25.1. The money demand curve will shift from 
to 
if
A. the price level increases. B. interest rates rise. C. interest rates fall. D. nominal income decreases.
Suppose the supply of bicycles is price elastic. This means that
A) consumers will respond significantly to an increase in the quantity of bicycles supplied. B) suppliers will respond significantly to changes in the price of bicycles. C) suppliers face many substitutes for bicycles. D) suppliers will increase the quantity of bicycles supplied, but not immediately.