According to the indifference principle, housing prices
a. tend to converge over time
b. tend to leave individuals indifferent about where they live
c. only tend to be different to compensate individuals for differences in living conditions
d. only B&C
d
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When firms spend more on additional holdings of raw materials, parts and finished goods ________
A) they are increasing their fixed investment B) they are increasing their inventory investment C) they are increasing their private consumption D) all of the above E) none of the above
Autonomous consumption is
A. that part of consumption that rises or falls with changes in disposable income. B. the minimum that people will spend even if disposable income is zero. C. the amount people will spend when the C line crosses the 45-degree line. D. the amount people will spend when income is equal to consumption.