Which of the following is a reason that consumption depends on current income, and not just on total wealth?
A) Banks will not always lend money to those who want to consume more than their income.
B) The anticipation of future financial distress makes some people reluctant to borrow.
C) Low income people may prefer to postpone some consumption until later years, when their incomes are higher.
D) all of the above
E) none of the above
D
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From 1997 to 2003, stock prices based on the Standard and Poor's index and the share of investment spending as a component of GDP tended to
A) move in the same direction. B) be unrelated to each other. C) move in opposite directions. D) both remain relatively unchanged.
For a profit-maximizing firm in a monopolistically competitive market, when price is equal to average total cost, price must lie above marginal cost
a. True b. False Indicate whether the statement is true or false
Which of the following instruments is not used by the Federal Reserve to change the money supply?
A. open market operations B. the federal tax code C. the required reserve ratio D. the discount rate
Excise taxes on products like gasoline and tobacco are regressive.
Answer the following statement true (T) or false (F)