An explanation for the low saving rate in the United States consistent with the demonstration effect includes:
A. highly-developed financial systems making it easy to buy homes with down payments under 15 percent.
B. households spending beyond their means to keep up with community standards.
C. large and persistent capital gains.
D. relatively generous government assistance for the elderly and large down payments required for home purchases.
Answer: B
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To be considered officially unemployed, a person must be at least 16 years old
A) and be a discouraged worker. B) and not working. C) and not in school and not working. D) and not working but is actively seeking employment.
A market failure associated with Keynesian economics is
A) pollution externalities. B) economic agents cannot agree on prices and wages that are socially efficient. C) insurance is imperfect. D) banking panics.
Which of the following statements is true?
A) when bond prices rise, real GDP and the price level rise. B) when bond prices fall, real GDP rises and the price level falls. C) when bond prices rise, the interest rate rises, and aggregate demand and the price level fall. D) when bond prices fall, the interest rate and aggregate demand fall.
Which one of the following is NOT true of a thin market?
A. It is caused by asymmetric information. B. There are relatively few high-quality goods sold. C. There may be some sellers of high-quality goods because people are in a hurry to sell. D. The price of the good sold will be higher than if the market were thicker.