According to the life-cycle theory of consumption, people tend to ________ during their early and later years.
A. save less than they invest
B. dissave
C. consume less than they earn
D. save
Answer: B
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You withdraw $2,000 from your account. Your bank has a desired reserve ratio of 20 percent. This transaction, by itself, will directly reduce
A) the quantity of money by $1,600. B) deposits by $1,600. C) the quantity of money by $2,000. D) deposits by $2,000.
In the recent Global Economic Crisis, all of the following are causes that pushed the IS curve to the left EXCEPT
A) the negative wealth effect from the collapse of the housing bubble. B) the end of cash-out mortgage refinancing. C) growing unwillingness of banks and nonbank financial institutions to grant loan. D) slow and minimal response of the U.S. government.
Suppose you are given the following data on demand for a product. The price elasticity of demand when price decreases from $9 to $7 is:PriceQuantity Demanded$1030940850760670
A. 1.60. B. 0.63. C. 2.27. D. 1.16.
Given that Sandy can produce 10 economics reports or 2 sales calls and Tim can produce 2 economics reports or 1 sales call, which of the following is FALSE?
A) Sandy has a comparative advantage in sales calls. B) Tim has a comparative advantage in sales calls. C) Sandy has a comparative advantage in economics reports. D) Sandy has an absolute advantage in both economics reports and sales calls.