If Gerry saves $500 per month, then Gerry's ________ will increase by ________.
A. wealth; $500 only if he has no debt
B. wealth; $500 only if he buys additional assets
C. wealth; $500
D. income; $500 only if he buys additional assets
Answer: C
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Refer to the diagram. Assume that G and T 1 are the relevant curves, the economy is currently at A, and the full-employment GDP is B. This economy has a(n):
A. cyclically adjusted budget deficit.
B. actual budget deficit.
C. actual budget surplus.
D. neither a surplus nor deficit in the actual budget.
Refer to the figure below, which shows marginal benefits (MB) and marginal cost (MC) of activity A:If the decision maker is choosing 400 units of activity A,
A. the activity could be increased by one unit and net benefits will increase by $15. B. this level maximizes net benefits. C. the activity could be reduced by one unit and net benefits will rise by $25. D. the activity could be reduced by one unit and net benefits will increase by $10. E. the activity could be reduced by one unit and net benefits would decrease by $10.