The government purchases component of GDP includes:
A. purchases of final goods and services.
B. payments made to social security recipients.
C. interest payments on government debt.
D. transfer payments.
Answer: A
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The above table gives the demand and supply schedules for cat food. If the price is $3.00 per pound of cat food, will there be a shortage, a surplus, or is this price the equilibrium price?
If there is a shortage, how much is the shortage? If there is a surplus, how much is the surplus? If $3.00 is the equilibrium price, what is the equilibrium quantity?
What would be the impact of a minimum wage that is set below the equilibrium wage that would otherwise prevail in the labor market?
What will be an ideal response?
Economic regulation is government policy designed to
a. improve health and safety in products and in working conditions b. prevent firms from monopolizing or developing a cartel in existing competitive markets c. eliminate existing monopolies by breaking them apart into many smaller firms d. create monopolies by forcing competitive firms to merge e. control price and output in industries where monopoly is desirable
A black market is a market where buying and selling take place
A) at prices that violate government price regulations. B) in non-licensed shops and warehouses. C) after regular office hours. D) on foreign soil.