If the national incomes of our trading partners increase, then our:
A. Aggregate demand decreases because C decreases
B. Aggregate demand increases because C increases
C. Aggregate demand decreases because net exports decrease
D. Aggregate demand increases because net exports increase
D. Aggregate demand increases because net exports increase
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Suppose the price of a soda is $2 each, the price of a hot dog is $3 each and the budget is $20. If the marginal utility of the fourth soda is 100 and the marginal utility of the fourth hot dog is 150, to maximize utility, a person will buy
A) 4 sodas and 4 hot dogs. B) more hotdogs than 4 and fewer sodas than 4 because hot dogs provide more utility. C) more sodas than 4 to increase their utility. D) fewer sodas than 4 and more hot dogs than 4.
You can borrow $5000 to finance a new business venture. This new venture will generate annual earnings of $251. The maximum interest rate that you would pay on the borrowed funds and still increase your income is
A) 25%. B) 12.5%. C) 10%. D) 5%.