Refer to Figure 18.1. Which of the following would most likely cause a shift from AD1 to AD2?
A. A decrease in the money supply through open market operations.
B. An increase in transfer payments because of a recession.
C. A decrease in government spending.
D. An increase in the tax rate.
Answer: B
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The table above shows how the number of books Katie buys each year depends on her income a. What kind of relationship exists between Katie's income and the number of books she purchases? b
Plot the relationship between Katie's income and the number of books she purchases in the above figure. Measure income along the vertical axis and the number of books along the horizontal axis. Be sure to label the axes. c. What is the slope of the relationship between $50,000 and $70,000 of income? d. What is the slope of the relationship between $90,000 and $110,000 of income? e. Comment on the similarity or dissimilarity of your answers to parts (c) and (d).
The downfall of the fooling model is that it assumes an implausibly ________ level of perception about price on the part of ________
A) high, firms B) high, workers C) low, firms D) low, workers