For normal goods, the income effect and the substitution effect both work in the same direction; a decrease in the relative price of the good will increase quantity demanded both because the good is now cheaper than substitute goods, and because the lower price means that consumers have a grea...
Macroeconomicsstudies the behavior of a country and how its policies impact the economy as a whole. It analyzes entire industries and economies rather than individuals or specific companies. This is why it's referred to as a top-down approach. It tries to answer questions such as “What should...
What is the multiplier effect in macroeconomics? Macroeconomics: Macroeconomics is the study of large-scale economies. This is usually done from the national or global level. One thing that people who study macroeconomics are interested in is the chain-reaction of change. ...
What is income effect in economics? What distinguishes money from other assets in the economy? How does macroeconomics affect the economy? How is utility measured in economics? What is a price consumption curve in economics? Why is money not considered to be a capital resource in economics?
Inflation is one of the most important issues in macroeconomics. It affects the interest rate people get on their savings and the rate borrowers pay on their mortgages. It also has an effect on the level of pensions and state benefits, as well as the price of bus and train tickets. ...
C) What is Britneys opportunity cost of having another baby?D) Does the United States have a comparative advantage in information technology s 31、ervices?Answer: ATopic: Microeconomics and MacroeconomicsSkill: ConceptualStatus: Previous edition, Chapter 1AACSB: Reflective Thinking29) Which of the ...
“Ability to purchase” suggests that income is important. Professors are usually able to afford better housing and transportation than students, because they have more income. The prices of related goods can also affect demand. If you need a new car, for example, the price of a Honda may ...
What is the worst effect of a recession? An old economist joke is that a recession is when someone else loses their job, and a depression is when you lose your job. (Very few economists have transitioned to stand-up comedy.) Your job is your main source of income, and that's why it...
17. The advantage of automatic stabilizers over discretionary fiscal policy is that automatic stabilizers: A) have the full consent of the legislature. B) have been vetted and approved by the courts. C) do not require overt action by policymakers. D) take longer to take effect than fiscal ...
Answer: C Topic: Microeconomics and Macroeconomics Skill: Conceptual Status: Previous edition, Chapter 1 AACSB: Reflective Thinking 28) Which of the following questions is NOT a microeconomic question? A) Can the Federal Reserve keep income growing by cutting interest rates? B) How would a tax ...