Which of the following is a possible effect of automatic stabilizers on the federal budget?
A. An increase in the deficit when there is AD excess.
B. A decrease in the deficit during an expansion.
C. A decrease in the deficit during recessions.
D. An increase in the structural deficit during recessions.
Answer: B
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If a firm is price differentiating, then it is
A) producing a homogeneous product. B) charging different prices to different consumers based on differences in marginal costs. C) charging different prices based on quality. D) charging different prices based on advertising costs.
According to the factor-price equalization theorem, free trade between any two countries equalizes
A. product prices between the countries but not the prices of individual factors of production. B. average national income per person in the countries. C. product prices between the countries and factor prices within each country but not between the countries. D. product prices as well as the prices of individual factors of production between the countries.
The economic way of thinking should be thought of as
A) a hypothesis. B) a parable. C) a set of conclusions. D) an approach. E) a statistical procedure.
The probability of an event is the:
A) time taken for the event to occur. B) frequency at which the event occurs. C) net benefit to society from the event. D) total number of economic agents affected by the event.