A) consumption equals disposable income.
B) consumption equals disposable income plus the value of non-market work.
C) savings is always positive.
D) consumers may increase their consumption by borrowing.
E) consumers save more than they consume.
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A) average labour productivity.
B) average capital productivity.
C) total factor productivity.
D) the rate of growth of real GDP.
E) the marginal product of labour.
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There are many factors that contribute t...View Answer
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A) technological possibilities for converting factor inputs into outputs.
B) intellectual possibilities for converting factor inputs into outputs.
C) amount of resources available to the representative firm.
D) actual process of converting factor inputs into outputs.
E) amount of labour available to produce outputs.
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A) they be convex and that more is always preferred to less.
B) more is always preferred to less and that each consumer has one strictly favourite good.
C) each consumer has one strictly preferred good and that consumption and leisure are both normal goods.
D) consumption and leisure are both normal goods and that the consumer likes diversity in his or her consumption bundle.
E) more is always preferred to less and that consumers do not like diversity in his or her consumption bundle.
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A) when he or she can haggle for a lower price.
B) when he or she is a price-taker.
C) when he or she is a price-maker.
D) if the consumer is large relative to the size of the market.
E) when he or she has to make decisions regarding work and leisure.
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A) a primitive economy.
B) a barter economy.
C) a socialist economy.
D) an autarky economy.
E) a perfectly competitive economy.
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A) the introduction of the assembly line
B) the invention of the personal computer
C) good weather
D) a reduction in the relative price of energy
E) an educated work force
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A) consumption equals disposable income.
B) savings are positive.
C) more is preferred to less.
D) the consumer is rational.
E) the consumer consumes more than his or her disposable income.
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A) the real wage and the budget line is tangent to an indifference curve.
B) minus the real wage and the budget line is tangent to the indifference curve.
C) the real wage and the budget line intersects the indifference curve.
D) minus the real wage and the budget line intersects the indifference curve.
E) the real wage and on the highest possible indifference curve.
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A) the fact that more is preferred to less.
B) the fact that consumption and leisure are normal goods.
C) the fact that consumers are indifferent to consumption and leisure goods.
D) the fact that consumers prefer diversity.
E) the fact that income plays a significant role in consumption and leisure decisions.
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A) increases consumption and increases labour supply.
B) increases consumption and reduces labour supply.
C) reduces consumption and increases labour supply.
D) reduces consumption and reduces labour supply.
E) increases consumption and savings.
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A) is a stand-in for a more complicated function.
B) is useful only in microeconomics, not macroeconomics.
C) captures the preferences of the representative household over consumption and leisure goods.
D) captures the representative firm's ability to produce goods and services.
E) captures the maximum satisfaction of consumers.
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A) is made very quickly.
B) involves only the present.
C) involves only the future.
D) involves planning over more than one time period.
E) involved planning over exactly two time periods.
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A) the amount of time for decision making.
B) expressed as leisure time - time spent working = total time available.
C) expressed as leisure time - sleep time = time spent working.
D) expressed as leisure time + time spent working = total time available.
E) a result of consumers' busy work schedule.
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A) are diverse.
B) are not identical.
C) are identical.
D) exhibit differences.
E) exhibit different preferences.
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A) choices between work and leisure.
B) choices between happiness and utility.
C) choices between consumption and work.
D) choices between consumption and leisure.
E) more consumption and less leisure.
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A) denotes the consumer with the average amount of income.
B) plays the role of a stand-in for all consumers in the economy.
C) is the consumer who bargains with firms for all workers in the economy.
D) is always a misleading fiction.
E) is the consumer with an average standard of living.
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A) lowest possible indifference curve and is on or outside the consumer's budget constraint.
B) lowest possible indifference curve and is on or inside the consumer's budget constraint.
C) highest possible indifference curve and is on or outside the consumer's budget constraint.
D) highest possible indifference curve and is on or inside the consumer's budget constraint.
E) lowest possible indifference curve that maximizes total utility.
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A) a pure substitution effect.
B) a pure income effect.
C) a combination of income and substitution effects.
D) neither a pure income effect nor a pure substitution effect.
E) an income effect that is greater than the substitution effect.
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