Suppose the real money demand function is Md/P = 2400 + 0.2Y - 10,000 (r + ?e). Assume M = 5000, P = 2.0, and ?e = .03. If Y were to increase from 4000 to 5000, then the real interest rate would increase by how many percentage points?

If GDP included the value of leisure time, the value of U.S. GDP would most likely increase

Indicate whether the statement is true or false

If a tax is placed on one good and not another, the effect that causes you to buy less of the taxed good because it has become relatively more expensive is called the

A. domino effect. B. substitution effect. C. net effect. D. income effect.