If government purchases are increased by $30, taxes are reduced by $30, and the MPC is 0.75, equilibrium output will change by
A. $900.
B. $210.
C. $30.
D. zero.
Answer: B
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Opportunity cost is the combined value of all of the other alternatives that go unselected.
Answer the following statement true (T) or false (F)
In the simple circular flow diagram, the flow of money from the markets for goods and services to the firms is called
a. spending. b. revenue. c. income. d. wages, rent, and profit.
ATMs and human bank tellers:
A. are substitute resources. B. are capital goods. C. have both declined in number because of bank mergers. D. are complementary resources.
Refer to Figure 6.6, which shows a market for taxi medallions. If the number of taxi licenses is reduced from Q2 to Q1, the decrease in total surplus of the market is represented by:
A. area FGI. B. area GHI. C. area FHI. D. area BDFH - area FHI.