The consumption function illustrates that:
a. saving increases as disposable income decreases.
b. consumption increases as saving increases.
c. consumption increases as disposable income increases.
d. consumption increases as disposable income decreases.
e. consumption increases as investment increases.
c
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Refer to Figure 7-5. The efficient quantity of medical services is
A) 400. B) 800. C) 1,200. D) > 1,200.
An increase in the money supply
a. lowers the interest rate, causing a decrease in investment and an increase in GDP. b. lowers the interest rate, causing an increase in investment and a decrease in GDP. c. lowers the interest rate, causing an increase in investment and an increase in GDP. d. raises the interest rate, causing an increase in investment and an increase in GDP. e. raises the interest rate, causing a decrease in investment and a decrease in GDP.