In order to draw an individual's budget line, we must know
A) prices and preferences.
B) prices and income.
C) income and preferences.
D) prices, income, and preferences.
B
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If aggregate planned expenditure is greater than real GDP,
A) a planned decrease in inventories leads to a decrease in production. B) a planned increase in inventories leads to an increase in production. C) an unplanned decrease in inventories leads to an increase in production. D) an unplanned decrease in inventories leads to an increase in the price level. E) an unplanned increase in inventories leads to a decrease in production.
The country with a comparative advantage in the production of a good has a
A) vertical production possibilities frontier. B) higher opportunity cost of production. C) horizontal production possibilities frontier. D) linear production possibilities frontier. E) lower opportunity cost of production.