Certain religious texts prohibit charging interest to people who borrow. This is a form of

Which of the following correctly describes the mechanics of the spending multiplier? a. An initial increase in aggregate expenditures, such as an increase in government spending, shifts the aggregate expenditures curve upward vertically. b. After the expenditures curve shifts upwards, the economy is not in equilibrium because aggregate expenditures now exceed aggregate output, leading to

inventory depletion. c. Real GDP increases in response to inventory depletion, eventually leading to a new higher level equilibrium real GDP. d. All of the above answers are correct.

Evan left a job in which he was earning $75,000 a year for one he liked better but pays only $50,000 a year. Around the same time as the job switch, Evan needed to buy a new car. Had he kept his old job he would have bought a new car but instead he was forced to buy a used car. Therefore

a. used cars are normal goods for Evan b. new cars are inferior goods for Evan c. the supply curve for new cars shifted to the left d. new and used cars are complements e. used cars are inferior goods for Evan