Kimberly decides to go back to college full time at the age of 30, and finds herself with a much lower income than she was earning before. Now that she has less income, she finds herself eating less steak and more pasta than ever before. We can conclude:
A. steak and pasta are both normal goods, because they are both food she eats regardless of her income.
B. steak and pasta are both inferior goods, because they are both food she eats regardless of her income.
C. pasta is an inferior good because her demand increased when her income went down.
D. steak and pasta are both inferior goods, because they are both food she eats regardless of her income; also, pasta is an inferior good because her demand increased when her income went down.
C. pasta is an inferior good because her demand increased when her income went down.
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Total variable costs will initially increase and then begin to decrease as output increases.
Answer the following statement true (T) or false (F)
The Great Depression of the 1930s opened the door to the ________ revolution in macroeconomic theory
A) Keynesian B) old classical C) New Keynesian D) New classical
Assume the current interest rate on a one-year bond is 7%, and the interest rate investors expect on the one-year bond one year from now is 3%
According to the expectations hypothesis, the current interest rate (per year) on a two-year bond should be A) 3%. B) 5%. C) 7%. D) 10%.
Loans that are secured against an asset:
A. are much shorter in length than unsecured loans. B. generally have higher interest rates. C. are much longer in length than unsecured loans. D. generally have lower interest rates.