Which of the following can explain the choice to gamble in casinos?
A. Gamblers have risk loving tastes.
B. Gamblers have risk-averse but state-dependent tastes.
C. The casino is operating at a loss.
D. (a) and (b)
E. (a) and (c)
F. (b) and (c)
G. All of the above.
H. None of the above.
Answer: G
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The structural surplus
A) is legally required to be positive. B) fluctuates over the business cycle. C) is, by definition, equal to the negative of the cyclical deficit. D) equals the actual surplus plus the cyclical surplus. E) is the government budget surplus that would exist if the economy was at full employment.
As we move down a straight-line demand curve, the price elasticity becomes
A. larger. B. smaller. C. larger and then smaller. D. smaller and then larger.
Which of the following are most likely to become an endangered species?
A) animals in the wild B) domesticated animals C) animals that people like to keep at home as pets D) animals that people have property rights to own
Exhibit 17-4 Short-run and long-run Phillips curves
Suppose the economy in Exhibit 17-4 is at point E1, and the Fed increases the money supply. If people have rational expectations, then the economy will move:
A. to point A in the short run and point B in the long run. B. directly to point B. C. to point C in the short run and point D in the long run. D. directly to point D.