Economic goods are defined as
A) tangible items only.
B) services only.
C) anything from which an individual derives satisfaction.
D) any item which is available in sufficient quantity at zero price.
Answer: C
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Along a downward-sloping linear demand curve
A) the marginal utility from the consumption of each unit of the good rises and the total utility from consuming larger quantities remain constant. B) the marginal utility from the consumption of each unit of the good and the total utility from consuming larger quantities remain constant. C) the marginal utility from the consumption of each unit of the good falls and the total utility from consuming larger quantities increases. D) the marginal utility from the consumption of each unit of the good and the total utility from consuming larger quantities increase.
During the Great Depression, many industrial countries tried protecting domestic jobs by raising tariffs. Economic theory would suggest that the result would be
A) success for only the countries that raised tariffs first. B) success for firms that had a comparative advantage in manufactured goods rather than agricultural goods. C) reduced exports and volume of trade for everyone. D) increased incomes in the countries that pursued this policy.
If the spending multiplier equals 5 and equilibrium income is $2 billion below potential GDP, then _____ to reach the potential real GDP level
a. total spending needs to increase by $0.1 billion b. nominal GDP needs to increase by $1.2 billion c. total spending needs to decrease by $6 billion d. nominal GDP needs to decrease by $12 billion e. total spending needs to increase by $0.4 billion
In a closed economy, national savings is:
A. equal to national investment. B. the sum of the savings of individuals and corporations plus the savings of the government. C. the sum of public savings plus private savings. D. All of these are true.