In Figure 4-9 above, suppose LMA shifts to LMB. The distance from points A to L tells us
A) the change in income given zero interest responsiveness of Ap.
B) the change in income resulting from the interest rate falling to its value at point B?.
C) how much the money supply increased in producing the LM shift.
D) the change in income that by itself raises the demand for money by as much as the money supply rose.
D
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The economic way of thinking assumes individuals
A) are irrational. B) are only concerned with "number one" (i.e., themselves). C) try to advance their own projects. D) cannot possibly behave in the interests of others.
Which of the following statements about international trade is true?
A) Potentially, a country can have absolute advantage in all goods. B) Potentially, a country can have relative advantage in all goods. C) After trade, countries tend to specialize in the production of those goods in which they enjoy absolute advantage. D) None of the above is true.
The United States can produce 1,000 shoes if it specializes in shoe production. Alternatively, it can produce 500 shirts. Taiwan can produce 500 shoes or 200 shirts. Explain which country will specialize in shoe production and which in shirt production. What are the possible terms of trade?
Which of the following statements is true? a. Demand refers to how much of a good a consumer is willing to purchase at all prices
b. Demand refers to how much of a good a consumer is able to purchase at all prices. c. Demand refers to how much of a good a consumer is able to consume during a given period of time. d. Demand refers to how much of a good a consumer is willing and able to purchase at all prices.