The vertical intercept of the consumption function measures autonomous consumption. It represents the combined impact on consumption spending of all factors other than disposable income
a. True
b. False
A
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The cost of producing an additional unit of a good or service that is borne by the producer of that good or service
A) always equals the benefit the consumer derives from that good or service. B) equals the cost borne by people other than the producer. C) is the marginal private cost. D) is the external cost. E) is the marginal social cost.
Typically, employers compete with each other in the labor market to get and to retain the best possible workers. Explain how such competition might prevent the unemployment rate from ever being close to zero
What will be an ideal response?
The idea that a tax cut will create an incentive for people to increase their quantity of labor supplied, which will shift aggregate supply to the right and that will lower the price level and increase real GDP, is held by the
a. rational expectations school b. school of supply-side economics c. neo-Keynesian school d. classical school e. Keynesian school
Macroeconomic equilibrium is always good, because:
a. Because it is the only place where planned demand equals planned supply. b. Actually, macroeconomic equilibrium can be either good or bad. It is not always good. c. All of the above. d. None of the above. e. Because it is the only place where actual demand equals actual supply.