If a household’s income declines, then its budget line is
A. unaffected.
B. going to be steeper.
C. shift parallel, closer to the origin.
D. shift parallel, further away from the origin.
E. become more concave toward the origin.
Answer: C
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Union members earn about the same wage level as nonunion members in the same industry.
Answer the following statement true (T) or false (F)
At Revolution Doughnuts in Fort Collins, Colorado, a cup of coffee or a doughnut is $1. Suppose Hannah loves going to Revolution Doughnuts. She spends $5 a day at the shop on 3 doughnuts and 2 cups of coffee. Is Hannah maximizing her total utility?
A) No. B) Maybe, but I need to know more about Hannah's income. C) Yes. D) Maybe, but I need to know more about Hannah's marginal utility per dollar for each of the two goods.
Sophisticated theoretical arguments supporting import-substitution policies include
A) terms of trade effects. B) scale economy arguments. C) learning curve considerations. D) the problem of appropriability. E) domestic market failure arguments.
A currency bailout
A. Is considered to be a dangerous move by the central banks of the strongest economies worldwide. B. Occurs when money is borrowed from an economy to increase the value of its currency. C. Is considered to be a dangerous move by the International Monetary Fund. D. Can help avoid a situation in which a weakness in one currency undermines other currencies.