If a price ceiling is set above the current market clearing price, then
A. there will be incentives for black markets to develop.
B. a shortage must immediately occur.
C. a surplus must immediately occur.
D. quantity demanded will remain equal to quantity supplied at the current market clearing price.
Answer: D
Economics
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In the above figure, the marginal propensity to consume (MPC) equals
A) 0.9. B) 0.75. C) 0.8. D) 0.85.
Economics
An increase in the marginal propensity to consume would cause the IS curve to
A) make a parallel shift to the right. B) make a parallel shift to the left. C) rotate to become steeper from its vertical intercept. D) rotate to become flatter from its vertical intercept. E) rotate to become flatter from its horizontal intercept.
Economics