There are 20 residents in the village of Towneburg. The size of the village's annual fireworks display depends upon the number of shells that are fired off. Each resident's demand for fireworks is shown below. The total cost of the fireworks display is $1,000 plus $10 per shell.
If Towneburg's fireworks display has 20 shells, then the size of the display is:
A. optimal.
B. smaller than optimal.
C. larger than optimal.
D. unaffordable.
Answer: B
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For the purposes of GDP accounting, government purchases include
A) the purchases of new military equipment. B) direct transfer payments by the government to other individuals. C) Social Security payments. D) welfare payments.
Which of the following changes to the market in the graph shown could cause the price ceiling to become non-binding?
A. Demand could increase, and shift to the right.
B. Supply could increase, and shift to the left.
C. Supply could increase, and shift to the right.
D. Supply could decrease, and shift to the left.
If a large number of skilled workers retire at about the same time through early retirements or buyouts, what will happen to the wages of skilled workers, other things being equal?
Explain how automatic stabilizers work
What will be an ideal response?