When economists say that private investment is "autonomous," they mean that it:
A. will never change.
B. is not dependent on the current level of disposable income.
C. is determined by the "animal spirits" of business decision makers.
D. is determined by the level of saving.
Answer: B
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The following diagram shows the rate of inflation each year during a five-year span. Use this diagram to answer the next question.
How fast did prices rise in Year 2?
A. -2% B. 6% C. 4% D. 2%
In a market economy, a resource is compensated according to
a. the needs of its owner. b. its contribution to the final product. c. social priority. d. government direction.
Social Security is
A) an insurance program operated by the federal government. B) a retirement program that invests the person's contributions into interest-earning financial assets so the proceeds can fund the person's retirement. C) a social insurance program that guarantees that an elderly person will never fall below the poverty level. D) an intergenerational transfer program that only vaguely relates to past earnings.
Larry was accepted at three different graduate schools, and must choose one. Elite U costs $50,000 per year and did not offer Larry any financial aid. Larry values attending Elite U at $60,000 per year. State College costs $30,000 per year, and offered Larry an annual $10,000 scholarship. Larry values attending State College at $40,000 per year. NoName U costs $20,000 per year, and offered Larry a full $20,000 annual scholarship. Larry values attending NoName at $15,000 per year. Larry's opportunity cost of attending State College is:
A. $20,000 B. $35,000 C. $15,000 D. $30,000