The "income effect" in the market for aspirin means that
A) aspirin are generally taken by people with higher than average incomes.
B) a decrease in the price of a substitute good like acetaminophen will make aspirin takers feel a little poorer than they were before.
C) an increase in the price of aspirin will reduce the total purchasing power of aspirin takers, making them able to afford fewer aspirin.
D) an increase in the price of aspirin will cause headache sufferers to look for a lower priced remedy.
C
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A) fixed-rate; no B) fixed-rate; considerable C) floating-rate; no D) floating-rate; considerable
If real GDP is higher in one country than in another, then we can be sure that the standard of living is higher in the country with the higher real GDP
a. True b. False Indicate whether the statement is true or false
Suppose you were asked, "Can you guess the height of the tallest living man? Is it more than 8 feet?" When people suggest an answer in the question they ask, it is a form of:
A. rule of thumb. B. time inconsistency. C. anchoring. D. positive framing.
When airplanes take off and land at Logan airport, residents of East Boston complain about the noise. The same planes make the same noise during the trip to Boston from Paris, but there are no ____ for most of the trip because ____.
A. free riders; passengers must pay to board the plane B. third parties; there are no externalities C. externalities; there are no third parties D. complaints; airplanes are insulated