Based on a World Bank study, medical treatment in developing countries has an elasticity value greater than 1.
Answer the following statement true (T) or false (F)
True
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In an increasing-cost industry, the entry of new firms
a. decreases equilibrium price b. increases average cost at each level of output c. shifts the industry demand curve to the left d. increases economic profits in the industry e. shifts the long-run industry supply curve to the right
The emphasis on the greater incentives to produce, created by lower taxes, has come to be known as:
a. the trickle-down economics. b. the supply-side economics. c. the paradox of thrift. d. the permanent income hypothesis. e. monetarism.
If commercial banks are maintaining a 4 percent reserve/deposit ratio and the Fed raises the required reserve ratio to 6 percent, then banks will ________ their loans based on current deposits, and the money supply will ________.
A. decrease; decrease B. increase; increase C. decrease; increase D. increase; decrease
Refer to the above table. The table gives the combinations of real disposable income and real consumption for a college student for a year. What is the value of the average propensity to consume when real disposable income equals $4,000?
A) 0.7 B) -0.45 C) 1.45 D) 0.69