Refer to the information provided in Figure 2.4 below to answer the question(s) that follow.
Figure 2.4According to Figure 2.4, as the economy moves from Point A to Point E, the opportunity cost of motorcycles, measured in terms of hybrid cars
A. remains constant.
B. decreases.
C. initially increases, then decreases.
D. increases.
Answer: D
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Which of the following is true?
A) If MPC = 0.50, then the multiplier is 2.00. B) If MPC = 0.82, then the multiplier is 1.25. C) If MPS = 0.35, then the multiplier is 2.86. D) If MPC = 0.97, then the multiplier is 3.33. E) a and c
If the MPS is 0.2, the tax multiplier is
A. -1.11. B. -4. C. -5. D. -9.
An increase in the money supply shifts the LM curve to the right, causing the interest rate to ________ and output to ________, everything else held constant
A) rise; rise B) rise; fall C) fall; rise D) fall; fall
Often economists measure the loss in consumer surplus by looking at the changing area below the Marshallian demand curve. This approach will provide a more accurate measure of the compensating variation of such a price increase if: a. the good occupies a small portion of a person's budget
b. the good occupies a large portion of a person's budget. c. the good has many close substitutes. d. the good has few substitutes.