The income effect of a price change refers to
A) the change in demand that occurs when both income and price change.
B) the change in demand that occurs when consumer income changes.
C) the change in the quantity demanded of a good that results from the effect of a change in price on consumer purchasing power, holding everything else constant.
D) the change in the quantity demanded that results from a change in price, making the good more or less expensive relative to other goods, holding everything else constant.
C
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Econometric models of the U.S. economy generally agree
A) on the quantitative impact of monetary policy over a horizon of several years. B) that an increase in money growth will increase output in the short run. C) that an increase in money growth will decrease output in the short run. D) that an increase in money growth will decrease output in the long run. E) that "rational expectations" is the best way to generate policy forecasts.
A hypothesis is a normative statement
a. True b. False Indicate whether the statement is true or false