Figure 2-7
Which of the following could explain the shift in the production possibilities frontier from AB to AC in ?
a.
a productive improvement in petroleum production that has no effect on clothing production
b.
a productive improvement in clothing production that has no effect on petroleum production
c.
an increase in the size of the labor force that can produce either petroleum products or clothing
d.
oil drilling in Alaska is ended in order to protect the environment
e.
major oil reserves are discovered off the coast of Africa
d
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In the open-economy macroeconomic model, if investment demand decreases, then
a. the supply of dollars in the market for foreign-currency exchange shifts left. b. the supply of dollars in the market for foreign-currency exchange shifts right. c. the demand for dollars in the market for foreign-currency exchange shifts left. d. the demand for dollars in the market for foreign-currency exchange shifts right.
If the marginal propensity to consume is 0.60, then the multiplier equals
A. 1.67. B. 0.40. C. 0.60. D. 2.50.