Author Question: Other things equal, a marginal propensity to import of 0.8 implies that a 100 million increase in ... (Read 28 times)

charchew · **on:** Jun 30, 2018

Other things equal, a marginal propensity to import of 0.8 implies that a 100 million increase in domestic income will lead to an 80 million decrease in net exports.
a. True
b. False
Indicate whether the statement is true or false

Question 2

The opportunity cost of an airplane flight:
a. differs across passengers only to the extent that each traveler pays a different airfare.
b. is identical for all passengers and equal to the number of hours a particular flight takes.
c. differs across passengers to the extent that both airfares paid and the highest valued use of travel time vary.
d. is equal to the cost of a bus ticket, the next best form of alternative transportation to flying.