Suppose we examine how the consumer's optimum changes when the price of good X changes, while the consumer's tastes, income, and the price of all other goods are held constant. This procedure is used to derive
a. the Engel curve for good X.
b. the (ordinary) demand curve for good X.
c. the compensated demand curve for good X.
d. the substitution and income effects for good X.
b. the (ordinary) demand curve for good X.
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If the economy moves upward along its short-run Phillips curve, in the AS-AD diagram, this movement is shown by a
A) rightward shift of the AS curve and a movement along the AD curve. B) movement downward along the AS curve as a result of a leftward shift of the AD curve. C) movement upward along the AS curve as a result of a rightward shift of the AD curve. D) leftward shift of the AS curve and a movement along the AD curve. E) rightward shift of potential GDP.
Which of the following best describes average variable cost?
a. The change in total cost when one additional unit of output is produced. b. Total cost divided by the quantity of output produced. c. Total variable cost divided by the quantity of output produced. d. Total fixed cost divided by the quantity of output produced. e. Costs that do not vary as output varies.
In the market for loanable funds, the supply curve:
A. represents savers. B. is downward sloping. C. reflects that more people will choose to save the lower is the interest rate. D. is made up of people who want to borrow funds.
Advertising intended to induce a consumer to discover a previously unknown taste or preference is
A) persuasive advertising. B) informational advertising. C) direct advertising. D) mass marketing advertising.