A barter arrangement simply means A) the government has paid for the goods. B) a promise to pay in the future. C) that gold must be offered from one party. D) a direct exchange of goods without the use of money. ANSWER D
Which of the following factors will NOT cause a shift in the demand for a good? A) A change in consumer incomes B) A change in the market price of the good C) A change in the number of consumers D) A change in tastes and preferences ANSWER B
Recently economists have added what factor as a major explanation of economic growth? A) the growth rate of labor B) the growth rate in labor and capital productivity C) technology D) the growth rate of capital ANSWER C
If you have $5000 and the GDP deflator decreases from 100 to 80 A) the $5000 will buy 20 percent more of the goods and services produced by society. B) the value of the $5000 remains constant. C) the $5000 will buy 20 percent less of the goods and services produced by society. D) the […]
Money functions as a(n) A) medium of exchange. B) unit of account. C) store of value. D) all of the above. ANSWER D
________ is a calculation that adds up costs and benefits using a common unit of measurement, like dollar values. A) Expenditure-income analysis B) Budget constraint analysis C) Revenue-income analysis D) Cost-benefit analysis ANSWER D
At the break-even point for the consumption function A) saving is positive. B) saving is zero. C) saving is negative. D) the marginal propensity to consume equals l. ANSWER B
Which one of the following statements is NOT true? A) The classical model assumes that people suffer from money illusion. B) The classical model assumes that no single seller of a commodity can affect its price. C) The classical model assumes that pure competition exists. D) The classical model assumes that people are motivated by […]
A barter arrangement essentially means A) swapping goods for cash. B) buying with an I.O.U. C) a credit deal. D) a cashless transaction. ANSWER D
In the above figure, the marginal propensity to consume (MPC) equals A) 0.9. B) 0.75. C) 0.8. D) 0.85. ANSWER A