When housing prices decrease, household wealth ________, and consumption ________.
A. increases; increases
B. decreases; decreases
C. increases; decreases
D. decreases; increases
Answer: B
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During the 1980s both the relative price and the purchases of BMWs increased dramatically. In the economic way of thinking,
A) the supply curve of BMWs shifted to the right. B) the demand curve for BMWs shifted to the right. C) the supply curve of BMWs shifted to the left. D) the demand curve for BMWs shifted to the left.
Of the $840 billion American Recovery and Reinvestment Act stimulus package which was enacted in 2009, the largest tax cuts occurred in which category?
A) infrastructure tax cuts B) business tax cuts C) individual tax cuts D) energy tax cuts
The tax revenue that is generated by a government tax is counted towards total welfare
What will be an ideal response?
A bank allows us to diversify risk because it has a:
A. big pool of borrowers and savers, so the risk of repayment is spread among many. B. small amount of borrowers, but many savers, so it can combine savings to make larger loans. C. small amount of borrowers and savers, so it can connect the optimal saver to the best-matched borrower. D. big pool of borrowers, but not many savers, so it can choose the riskiest person to borrow from.