The purchase of fifty new food-processing machines by the Campbell Soup Corporation would be classified as investment spending
a. True
b. False
Indicate whether the statement is true or false
True
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Economists refer to a holdout as someone who refuses to produce a pure public good with private funds
Indicate whether the statement is true or false
Which of the following raises the equilibrium price and increases the equilibrium quantity of used cars?
A) a fall in income if used cars are an inferior good B) an increase in the wage rate paid to used car salespeople C) neither of the above because the question suggests a violation of the "law of demand" D) neither of the above because the question suggests a violation of the "law of supply"
Expansionary fiscal policy to prevent real GDP from falling below potential real GDP would cause the inflation rate to be ________ and real GDP to be ________
A) higher; lower B) higher; higher C) lower; lower D) lower; higher
The authors provide an example that illustrates the calculation of the present discounted value for the lost wages from a deceased worker, and one component in this calculation is the worker's annual mortality rate (m)
Suppose we conduct this computation in two different ways --- one calculation assumes m is constant for all future periods, and the other calculation allows m to decline over time due to improvements in medical technology. Which estimated PDV will be larger? A) The PDV with constant m will be larger B) The PDV with variable m will be larger C) The two PDV's will be equal D) The answer to this question depends on the assumed interest rate