Which of the following is not included in personal consumption expenditures?
A. New furniture and appliances bought by homeowners
B. Payments for cable and Internet services to homes
C. Purchases of mutual funds by consumers
D. Food purchased at supermarkets
C. Purchases of mutual funds by consumers
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Public transit offers discounted monthly passes to students, which can only be bought and used with valid student IDs. The transit system is using
a. A direct discrimination scheme b. An indirect discrimination scheme c. The Robinson-Patman act d. None of the above
The problem caused when people are often reluctant to voluntarily pay for goods and services that provide benefits for everyone, even for those who don't pay is called the:
A. drop in the bucket hypothesis. B. rational ignorance problem. C. moral hazard problem. D. free-rider problem.
Suppose Tammy grew up on a farm and is very good at plowing. In addition suppose she is a popular country singer who earns $4,000 per performance. If her husband Bob can plow (but not as well as Tammy) but he can't carry a tune, then it would be most efficient if
a. Tammy did both the plowing and the singing. b. Tammy specialized in plowing and Bob in singing. c. Bob did both the plowing and singing. d. Tammy specialized in singing and Bob in plowing. e. They both plowed and sang.
Figure 9-4
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In Figure 9-4, if the economy faces an inflationary gap, what must happen to reach potential GDP?
A. The expenditure level must rise and/or the price level must rise. B. The expenditure level must rise and/or the price level must fall. C. The expenditure level must fall and/or the price level must fall. D. The expenditure level must fall and/or the price level must rise.