In an economy with no income taxes or imports, the expenditure multiplier is
A) greater than 1 only if the MPC is greater than 1.
B) less than 1 only if the MPC is less than 1.
C) equal to 1 if the MPC is greater than 1.
D) greater than 1 if the MPC is less than 1.
E) always less than 1 no matter what the size of the MPC.
D
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When Maxwell Fruit Drinks increases the number of workers it employs from 20 to 25, its total labor costs rise from $10,000 to $15,000 a week. We know then that
a. Maxwell should never have hired the last five workers b. Maxwell should continue hiring workers c. diminishing returns have set in d. the marginal revenue product curve is decreasing e. the marginal labor cost is $1,000
Assume that smartphones are a normal good, and that the prices of smartphones have fallen in recent years. Over this same period, the price of the components used to produce smartphones has also fallen and consumer incomes have risen. Which of the
following best explains the falling prices of smartphones? A) The supply curve for smartphones has shifted to the right while the demand curve for smartphones has shifted to the left. B) The demand curve for smartphones has shifted to the right more than the supply curve has shifted to the right. C) The demand curve and the supply curve for smartphones have both shifted to the left. D) The supply curve for smartphones has shifted to the right more than the demand curve has shifted to the right.
What is a production function?
What will be an ideal response?
Refer to the above figures. A quota is placed on a foreign good. Which figure represents the situation in the domestic market for a competing domestic good?
A. Panel A B. Panel B C. Panel C D. Panel D