If the MPC in an economy is 0.75, government could shift the aggregate demand curve leftward by $60 billion by
A. reducing government purchases by $60 billion.
B. reducing government purchases by $12 billion.
C. increasing taxes by $15 billion.
D. increasing taxes by $20 billion.
Answer: D
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The International Monetary Fund (IMF) was created to achieve each of the following goals EXCEPT
A) to help finance economic development in poor countries. B) to lend funds to countries having difficulties meeting their international payment obligations. C) to encourage convertibility of member countries' currencies. D) to supervise exchange-rate practices of member countries.
A decrease in consumption will result in
A) both total utility and marginal utility decreasing. B) total utility increasing, but marginal utility decreasing. C) total utility decreasing, but marginal utility increasing. D) both total utility and marginal utility increasing.
The public choice model can be used to examine voting models that contrast the manner in which collective decisions are made by governments (state, local, and federal) and the manner in which individual choices are made in markets
Which of the following descriptions is consistent with the difference between collective decision-making and decision-making in markets? A) Individuals are less likely to see their preferences represented in the outcomes of government policies than in the outcomes of markets. B) The cost of a government policy is determined by a majority vote of members of the public; decisions made in markets are based on individual willingness to pay. C) Choices made through government policies are more important than decisions individuals make through markets. D) Everyone who votes must agree with a decision made collectively through government, but in markets individuals can make their own choices.
The golden rule of profit maximization states that any firm maximizes profit by producing where
a. demand is unit elastic, and total revenue is greatest b. price equals average revenue c. price equals marginal revenue d. price equals marginal cost e. marginal revenue equals marginal cost