What happens when consumers in the economy start to spend less, perhaps because they become worried about the future?
A. Savings rises, causing increases in investment that boost GDP.
B. The demand for dollars falls, causing the exchange rate to fall and exports to rise.
C. Prices fall, causing consumers to start spending again.
D. The incomes of other people fall, causing those people to spend less as well.
Ans: D. The incomes of other people fall, causing those people to spend less as well.
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When production generates a negative externality, the true cost of production is the ________ cost of production
A) private B) external C) social D) average
The elasticity of resource demand measures the:
A. responsiveness of workers to changes in wage rates. B. responsiveness of producers to changes in resource prices. C. ratio of marginal revenue product to resource price. D. sensitivity of marginal revenue product to changes in product price.
Demand for one item goes down when the price of another item goes down. These items must be
A. substitutes. B. inferior goods. C. normal goods. D. complements.
Consider the following data for a firm over a period of time. The contribution of the firm to domestic output by the value-added method is:
A.
$5,000
B.
$40,000
C.
$45,000
D.
$50,000