The Lorenz curve demonstrates:
A. inequality visually; the more linear the curve, the less inequality exists.
B. inequality visually; the more linear the curve, the more inequality exists.
C. average income levels per capita; the more linear the curve, the less inequality exists.
D. average income levels per quintile; the more linear the curve, the more inequality exists.
A. inequality visually; the more linear the curve, the less inequality exists.
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Wichita is building a convention center and financing it with revenues raised from a city hotel tax. Local politicians assert that the convention center is essentially free for Wichita residents because out-of-town visitors are paying for it
Someone who is practicing the economic way of thinking would disagree because A) the hotel tax may lead to a decline in visits to Wichita. B) they believe that Wichita does not need a new convention center. C) the hotel tax may reduce commercial property values in the area. D) there are other projects that could be undertaken with the tax funds. E) the convention center may not pass a marginal cost-benefit test.
Refer to Figure 3.2. Betty's dominant strategy is
A) North. B) West. C) East. D) Betty has no dominant strategy.
Which of the following situations is used as a justification for government?
A) negative externalities B) removal from the prisoner's dilemma C) nonexcludable goods D) positive externalities E) all of the above
Under the gold standard, if a country had a deficit in its balance of payments, it would have to:
A. sell gold in order to keep the value of its currency from rising. B. buy gold in order to keep the value of its currency from rising. C. sell gold in order to keep the value of its currency from falling. D. buy gold in order to keep the value of its currency from falling.