A lower interest elasticity of investment demand leads to a
a. steeper IS curve.
b. flatter IS curve.
c. steeper LM curve.
d. flatter LM curve.
A
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Based on the answer above, the price for bus rides _____________ and the quantity demanded for rides ____________
a. Decreases; decreases b. Decreases; increases c. Decreases; uncertain d. Increases; uncertain
Classify each of the following as debits or credits in the U.S. balance of payments. A. Russian tourists travel to United States. B. U.S. gives foreign aid to Bosnia. C. British investors purchase U.S. government bonds. D. American tourists travel to
Australia. E. Volkswagen earns profits in the United States from its new cars. F. Toyota builds a new plant in Ohio. G. Capital Records sells rock and roll music in Sweden. H. German consumer buy Ronco Vegematics made in United States. I. Procter & Gamble earns profits in their Mexican facility.
The consumption function shows the relationship between consumer expenditures and:
A. the interest rate. B. the tax rate. C. savings. D. disposable income.
In constructing models, economists:
A. make simplifying assumptions. B. include all available information. C. must use mathematical equations. D. attempt to duplicate the real world.