Which of the following is a positive economic statement?
a. A tax on butter will reduce the quantity of butter sold.
b. The rich do not pay enough in taxes.
c. People in poor countries should not work for less than $5 per hour.
d. All of the above are positive economic statements.
a. A tax on butter will reduce the quantity of butter sold.
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Using expansionary policies to combat a recession would
A) decrease discretionary spending. B) increase federal revenue. C) increase a budget surplus. D) increase a budget deficit.
A downward-sloping demand curve suggests that consumers
A) buy less at lower prices. B) buy more at higher prices. C) plan to buy more at a given, lower price. D) ignore marginal benefits and only focus on the supply of a product.
When the supply of a good decreases and its demand increases by the same amount: a. Price will change in the same direction as the shift in demand
b. Price will change in the same direction as the shift in supply. c. Quantity exchanged will change in the same direction as the shift in supply. d. Quantity exchanged will change in the same direction as the shift in demand.
If economists estimate the price elasticity of demand to be 0.75 for good X and 1.25 for good Y, then the government can raise the most revenue by taxing good Y
Indicate whether the statement is true or false