The figure above shows Sam's budget line. Sam's budget line shows
A) which combinations of gasoline and coffee Sam can afford.
B) which combinations of gasoline and coffee Sam is planning to purchase.
C) whether or not Sam thinks gasoline and coffee are worth their prices.
D) whether or not Sam currently has enough gasoline and enough coffee.
A
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U.S. opponents of NAFTA argued that the agreement will hurt the United States. In their view, NAFTA's greatest harm will be its
A) harmonization of labor policies. B) harmonization of environmental policies. C) harmonization of the use of pesticides and herbicides. D) job destruction and downward pressure on U.S. wages. E) harmonization of product safety standards.
In a large open economy like the United States, an increased government budget deficit which reduces national saving
A) reduces investment and improves the current account balance. B) reduces investment and reduces the current account balance. C) has no effect on investment, but reduces the current account balance. D) has no effect on either investment or the current account balance.
A price floor is:
a. the lowest price a producer will accept. b. the lowest price a consumer will pay. c. a minimum price set by the government above equilibrium price. d. a maximum price set by the government above equilibrium price e. usually set equal to equilibrium price.
The price of a new toy increases from $5 to $7 and the quantity demanded decreases from 12,000 to 6,000 per month as a result. Based on this information, the price elasticity of demand (in absolute terms) is estimated to be equal to:
a. 0.5, indicating relatively elastic demand. b. 0.5, indicating relatively inelastic demand. c. 2.0, indicating relatively elastic demand. d. 2.0, indicating relatively inelastic demand.