Which of the following is likely more important for explaining the slope of the aggregate-demand curve of a small economy than it is for the United States?
a. the wealth effect
b. the interest-rate effect
c. the exchange-rate effect
d. the real-wage effect
c
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In an IS-LM model with an upward-sloping LM curve and a downward-sloping IS, how does the expenditure multiplier compare to [1/(1-b)]?
A) It is equal to it. B) It is greater. C) It is smaller. D) Cannot be answered with the information given.
According to the World Bank and the International Monetary Fund, which of the following countries has shown the greatest rate of economic growth in the past two decades?
A) China B) Germany C) United States D) Mexico
A regulated natural monopolist allowed to earn a "fair" rate of return would produce to the point at which
A) the price per unit equals the long-run average cost. B) the marginal revenue curve meets the long-run average cost curve. C) the marginal revenue curve meets the long-run marginal cost curve. D) the price per unit equals its marginal revenue.
When wages decrease a. the substitution effect increases the quantity of labor supplied. b. the substitution effect increases the supply of labor
c. the income effect increases the quantity of labor supplied. d. the income effect increases the supply of labor.