Rational individuals prefer to consume goods during the current year rather than in the future because of:
a. positive time preference.
b. positive consumption preference.
c. high expected rate of inflation.
d. high market rate of interest.
A
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In a closed economy:
A) consumption is equal to zero. B) investment is equal to zero. C) government spending is equal to zero. D) net exports is equal to zero. In a closed economy, without the government, the consumption expenditure equals $5,000 and the investment expenditure equals $2,000.
Because of the slope of the aggregate demand curve, we can say that
A) a decrease in the price level leads to a lower level of real GDP demanded. B) an increase in the price level leads to a higher level of real GDP demanded. C) a decrease in the price level leads to a higher level of real GDP demanded. D) an increase in the price level leads to no change in the level of real GDP demanded.