Figure 21-29 The Figure Below Illustrates the Preferences of a Representative Consumer

question 308

Multiple Choice

Figure 21-29
The figure below illustrates the preferences of a representative consumer, Nathaniel.
-Refer to Figure 21-29. A change in Nathaniel's optimum from point A to point B results from

• A)a change in Nathaniel's preferences.
• B)an increase in the income Nathaniel receives when he is young.
• C)an increase in the interest rate.
• D)a decrease in the interest rate.

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Definitions:

Real GDP

Gross Domestic Product adjusted for inflation, which represents the value of all goods and services produced within a country's borders in a given period, measured in constant prices.

GDP

Gross Domestic Product, the total value of all goods and services produced by a country over a specific time period.

Average Price Level

An economic measure that calculates the weighted average of prices across a basket of goods and services, often used to identify inflation or deflation in an economy.

Net Exports

The difference between a country's total value of exports and its total value of imports within a certain timeframe.