The economy pictured in the figure has a(n) ________ gap with a short-run equilibrium combination of inflation and output indicated by point ________. 
A. recessionary; A
B. recessionary; C
C. recessionary; B
D. expansionary; A
Answer: D
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Mutual interdependence would tend to limit control over price in which market model?
A. Pure competition B. Monopolistic competition C. Oligopoly D. Pure monopoly
If, in the aggregate, consumers spend 75 cents of every extra dollar received, then the
A. MPC is 0.75. B. APC is 1.25. C. APC is 0.75. D. MPS is 0.75.
Consider two people, Sandy Roos, who earns $25,000 . and Gary Behrman, who earns $50,000 . If the current flat-tax rate is 20 percent, then
a. Gary would prefer a poll tax to a flat tax b. Sandy would prefer a poll tax to a flat tax c. Gary and Sandy both pay the same amount of tax d. Sandy would prefer the flat tax to a progressive income tax e. Gary would prefer a progressive income tax to the flat tax
If a consumer purchases more of good A when her income falls, good A is an inferior good
a. True b. False Indicate whether the statement is true or false