Figure 3-5
In , if the initial demand for margarine were D1, an increase in the price of butter, which is a substitute for margarine, would tend to cause which of the following changes in the market for margarine?
a.
a shift in the demand curve from D1 to D2
b.
a shift in the demand curve from D2 to D1
c.
a movement along demand curve D1 from a to b
d.
a movement along demand curve D1 from b to a
a
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The international capital market is
A) the place where you can rent earth moving equipment anywhere in the world. B) a set of arrangements by which individuals and firms exchange money now for promises to pay in the future. C) the arrangement where banks build up their capital by borrowing from the Central Bank. D) the place where emerging economies accept capital invested by banks. E) exclusively concerned with the debt crisis that ended in the 1990s.
Assume the marginal propensity to consume (MPC) is 0.75 and the government cuts taxes by $250 billion. The aggregate demand curve will shift to the:
a. right by $1,000 billion. b. right by $750 billion. c. left by $1,000 billion. d. left by $750 billion.