Which of the following is not an example of an efficiency-equity trade-off faced by economic agents?
A) According to an article by in the American Journal of Public Health by Edward Kaplan and Michael Merson of Yale University School of Medicine, the federal government's current method of allocating HIV-prevention resources is not cost-effective. Instead of allocating resources to states in proportion to reported AIDS cases, resources should flow first to those activities that prevent more infections per dollar and then to less and less effective combinations of programs and populations until funds are exhausted, even if it means that some populations would be left without any prevention services.
B) Concerned about the falling birth rate, the French government has pledged more money for families with three children, in an effort to encourage working women to have more babies.
C) The growing demand for corn by ethanol producers has led to a surge in the price of tortillas, a staple in the Mexican diet. To quell public outcry over rising tortilla prices, the Mexican government released government corn stocks at prices well below the market, and pressured states to impose price ceilings on tortillas.
D) Some U.S. colleges cut back on merit scholarships since these programs siphon money from need-based programs, thus harming lower-income students with greater financial need.
Answer: B
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The notion of utilitarian justice is that
A. any change that makes some people better off without making anyone worse off should be undertaken. B. income should be distributed so that the well-being of the worse-off member of society should be maximized. C. income should be distributed according to an individual's needs. D. through income redistribution, the rich sacrifice a little and the poor gain a lot.
According to classical economists, the credit market reaches an equilibrium when
A) desired investment equals desired saving. B) desired investment equals planned changes in aggregate supply. C) desired investment equals planned investment. D) planned investment equals government expenditures.
Unemployment rates were much higher in the 1980s than they were in the 1950s basically because
A) a higher percentage of the population was in the labor force in the 1980s, but the cost to many of them of being unemployed was much lower than it was in the 1950s. B) automation has eliminated many unskilled jobs. C) fewer jobs are available in the 1980s relative to the population. D) inflation raises unemployment rates. E) recessions have become much more severe since the 1950s.
To understand most of today’s economic activity in the U.S. economy, we should look at which of the following models?
A. Perfect competition and pure monopoly B. Perfect competition and oligopoly C. Oligopoly and monopolistic competition D. Monopolistic competition and monopoly