In order to isolate the substitution effect of a price increase, a consumer
a. must be given a lower price on the other good so that he can achieve his original indifference curve.
b. must be given enough of the other good so that his consumption of that good is not influenced.
c. must be given enough additional income to allow him to achieve his original indifference curve.
d. must be given enough additional income to allow him to purchase the original quantity of the good.
c. must be given enough additional income to allow him to achieve his original indifference curve.
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As the price of flour (an input in the production of cookies) increases, firms that produce cookies will:
A. decrease the quantity of cookies supplied. B. increase the quantity of cookies supplied. C. decrease the supply of cookies. D. increase the supply of cookies.
Incentive-based regulations:
a. set an environmental goal, but are flexible on how to achieve the goal. b. obtain more efficiency gains is obtainable from CAC regulations. c. effluent taxes are an example of incentive-based regulations. d. all of the above are true. e. none of the above are true.
Compare and contrast the U.S. economic record prior to 1940 and after 1950 . How do the two time periods differ? What best explains the differences according to a macroeconomist?
A modern economy is one where: a. there is no medium of exchange
b. a single seller controls the production of all goods and services. c. every individual interacts with thousands of other individuals to receive the goods they need to survive. d. international trade does not take place.