Irrespective of whether she is at her optimum, Jenna's valuation of coffee relative to orange juice can be measured by
a. her marginal rate of substitution between coffee and orange juice.
b. the price of coffee relative to the price of orange juice.
c. the ratio of the quantity of coffee that she buys relative to the quantity of orange juice that she buys.
d. the ratio of the quantity of coffee supplied in the market to the quantity of orange juice supplied in the market.
a
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The higher the marginal tax rate for a given welfare program, the greater the damage to the work incentives of recipients, ceteris paribus.
Answer the following statement true (T) or false (F)
The following graph shows the production possibilities curve for the economy with only two members, Silvia and Art. Silvia can produce either 50 pounds of beef or 2 computers per week, and Art can produce 100 pounds of beef or 1 computer per week. Both of them work 40 weeks per year.
Art's opportunity cost of producing one computer is ________ pounds of beef.
A. 1/50 B. 50 C. 1/100 D. 100
The late-1960s era Johnson 10% tax surcharge designed to curb inflation is an example of
A. monetary policy. B. discretionary (and expansionary) fiscal policy. C. discretionary (and contractionary) fiscal policy. D. nondiscretionary fiscal policy.
The term that is used to refer to a situation in which one party to a transaction has more or better information than the other party is
A) adverse selection. B) asymmetric information. C) moral hazard. D) deceptive trade practices.