When a recession ends
A) the household sector decreases spending substantially.
B) firms increase the amount of borrowing.
C) interest rates decrease.
D) households decrease spending on durable goods.
B
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Economic efficiency is defined as a market outcome in which the marginal benefit to consumers of the last unit produced is equal to the marginal cost of production, and in which
A) the sum of the benefits to firms is equal to the sum of the benefits to consumers. B) the sum of consumer surplus and producer surplus is minimized. C) economic surplus is minimized. D) the sum of consumer surplus and producer surplus is at a maximum.
Microsoft wants to calculate the effect of a worldwide 5% price cut on its sales of Excel to clients in different countries. Microsoft sells Excel at different prices in U.S., Japan and Europe. Before the price cut U.S
sales were twice sales in Japan and Europe. If the price of elasticity of demand in the U.S., Japan and Europe are -3, -4, and -2 respectively, the worldwide sales rise by A) 10%. B) 15%. C) 20%. D) 25%. E) none of the above