1. Technology can be defined as the

A. discovery of new ways of making products.

B. result of savings.

C. ability to get more output from a given amount of inputs.

D. act of putting new methods into effect

2. Stable property rights

A. exist in all economies

B. are found in countries with dictatorships.

C. are conducive to investment.

D. are not necessary for rapid growth.

3. The application of new technology refers to

A. innovation.

B. imitation.

C. investment.

D. education.

4. Government spending and income taxes can affect the level of

A. aggregate demand.

B. exports.

C. income taxes.

D. investment.

5. The "investment" component of aggregate demand will include all of the following except

A. expenditures of business firms on new equipment.

B. resales of existing physical assets.

C. household spending on new homes.

D. expenditures of business firms on new plants.

6. If disposable income rises by $100 billion, we can expect that consumers will

A. increase their spending by less than $100 billion.

B. increase their spending by more than $100 billion.

C. increase their spending by $100 billion

D. increase their saving by $100 billion.

7. If the MPC is 0.80, then a change in disposable income of $60 billion will lead to an initial change in consumption of

A. $48 billion.

B. $70 billion.

C. $42 billion.

D. $60 billion.

E. $30 billion.