In the absence of crowding out, the aggregate demand curve will shift to the right the initial decrease in taxes. A) by less than B) by more than C) by the same amount D) sometimes by more than and other times by less than

In the absence of crowding out, the aggregate demand curve will shift to the right the initial decrease in taxes. A) by less than B) by more than C) by the same amount D) sometimes by more than and other times by less than

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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In the absence of crowding out, the aggregate demand curve will shift to the right
the initial decrease in taxes.
A) by less than
B) by more than
C) by the same amount
D) sometimes by more than and other times by less than

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ADDED DISCUSSION WITH QUESTIONS TOPIC: MARGINAL UTILITY 5 6 7 No. of Pieces Total Utility (Q) 1 2 3 4 (TU) 150 225 250 220 8 9 10 11 Marginal Utility is calculated using the formula given below 12 Marginal Utility (TU-TU)/(Q-Q) 13 14 D For 1 Piece For 2 Piece For 3d Piece (86-0)/(A6-0) -(87-86)/(A7-A6) 150 75 (88-87)/(AS-A7) 25 Marginal 15 Utility Formula 16 Marginal Utility 17 For 1st Piece of the Cake Marginal Utility1 = (150-0)/(1-0) Marginal Utility1 = 150 For 4th Piece (89-88)/(AS-AS) -30 For 2nd Piece of the Cake Marginal Utility2=(225-150)/(2-1) Marginal Utility2 = 75 For 3rd Piece of the Cake Marginal Utility3 = (250-225)/(3-2) Marginal Utility3 = 25 For 4th Piece of the Cake Marginal Utility4 = (220-250) / (4-3) Marginal Utility4 = -30 Therefore, here we can see how the marginal utility of a piece of cake declines after the consumption of the previous one. Here, the highest utility is reached at the consumption of the 3rd piece, beyond whichthe total declined. This is a…
This was wrong ighh