Which of the following is an example of a transfer payment?
a. wages paid to military personnel
b. benefits paid to Social Security recipients
c. purchase of aircraft by the Department of Defense
d. payments made to a contractor for construction of a highway
B
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Sarah and David both have linear demand curves for lemonade. Sarah's demand is more elastic than David's. At the current price of $0.50 per glass, they both choose to buy 5 glasses. A change in the price of lemonade to $0.75 per glass will
A) decrease Sarah's consumer surplus more than David's. B) decrease David's consumer surplus more than Sarah's. C) increase Sarah's consumer surplus more than David's. D) increase David's consumer surplus more than Sarah's.
In economics, "demand" refers to
A) the intensity of desire for a good. B) the amount of a good people need rather than the amount they want. C) the satisfaction a good will provide a person. D) how much of a good people will buy at any price during a given time period.
Expected value is
a. (Probability of state A+Value in state A) (Probability of state B+Value in state B) b. (Probability of state AValue in state A)+(Probability of state BValue in state B) c. (Probability of state AValue in state A)-(Probability of state BValue in state B) d. (Probability of state A-Value in state A) (Probability of state B-Value in state B)
When one firm lowers its price, its gain in sales at the expense of other firms is known as
a. administered sales. b. the substitution effect. c. the collusive effect. d. product differentiation.