The aggregate demand curve slopes downward in part due to the:
A. positive relationship between the price level and exports.
B. negative relationship between the price level and net exports.
C. negative relationship between the price level and imports.
D. All of these are true.
Answer: B
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Indicate whether the statement is true or false
The law of demand states that, other things remaining the same, the higher the price of a good, the
A) smaller is the demand for the good. B) larger is the demand for the good. C) smaller is the quantity of the good demanded. D) larger is the quantity of the good demanded.
The hourly wage rate is the opportunity cost of one hour of leisure because
A) the person's substitution effect exceeds his or her income effect. B) that is what a person gives up to enjoy the hour of leisure time. C) the person must work for a living. D) the person prefers leisure to work regardless of the wage.
Historical data depicted on a scatter diagram show that consumer spending and disposable income
A. converge as income grows. B. generally move together. C. diverge as income grows. D. show no clear relationship.