If the MPC = 3/4, an increase in government purchases of $40 billion will ultimately lead to:
a. a $160 billion increase in aggregate demand.
b. a $40 billion increase in aggregate demand.
c. a $30 billion increase in aggregate demand.
d. a $30 billion decrease in aggregate demand.
a
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Suppose that the Beltrand family owns a farm near San Angelo, Texas. Three options exist for how to best use the farm:
Option 1: Raise lambs and earn a profit of $425,000. Production expenses are $200,000. Option 2: Raise cattle and earn a profit of $475,000. Production expenses are $400,000. Option 3: Grow cotton and earn a profit of $600,000. Production expenses are $300,000. Which option should the Beltrand family undertake and what is the opportunity cost in this decision? A) Option 2, $425,000 B) Option 1, $600,000 C) Option 3, $475,000 D) None of the above
The European Union is an example of ________ integration.
A) regional B) relative C) global D) bilateral