In the above figure, if the economy is at point a, an increase in ________ will move the economy to ________
A) real wealth from the fall in the price level; point b
B) real wealth from the fall in the price level; point c
C) expected future income; point c
D) expected future income; point d
B
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In a simple economy (without government or foreign trade) where output can be purchased only by consumers or by firms, saving must equal
A) depreciation. B) income. C) consumption. D) investment.
In the above figure, if the market price is less than $7, the firm
A) produces 10 units. B) produces 8 units. C) produces 0 units. D) produces 11 units.
If the demand curve over a certain range is "price elastic," this implies that the:
a. percentage change in the quantity demanded exceeds one. b. percentage change in the quantity demanded exceeds the percentage change in product price. c. percentage change in price exceeds the percentage change in quantity demanded. d. product is non-reactive. e. product has no good substitute.
All of the following would cause exports to decline, except:
a. a depreciation of the domestic currency. b. a decline in foreign income. c. stricter government regulations on international trade. d. a decline in foreign preferences for domestic goods. e. foreign import quotas on domestic products.