If the price level increases, we would expect consumers to
a. raise their consumption functions.
b. move downward along their consumption functions.
c. lower their consumption functions.
d. move upward along their consumption functions.
c
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Compared to other nations, the United States spends the largest proportion on health care and consequently ranks above other industrialized nations in life expectancy and infant mortality.
Indicate whether the statement is true or false
A country that has an absolute advantage in producing all goods will ________
A) have a comparative advantage in some goods but not all B) produce all goods at lowest opportunity cost C) have a comparative advantage in all goods D) not gain from specialization and trade
Why do market failures arise in case of public goods?
a. The quantity produced is much more than is actually required by the people. b. The quality of these goods is not good enough. c. The quantity produced is too less from the society's point of view. d. The government wastes a lot of resources for producing a public good. e. The users of such goods are required to pay a high price for these goods.
Refer to Figure 6.4. If the current market transactions occur only over the output level where a buyer's willingness to pay is greater than a seller's willingness to accept, the government could have set:
A. a maximum price at A. B. a minimum price at A. C. a minimum price at C. D. There is not sufficient information.