The income distribution is a more accurate measure of economic inequality than the wealth distribution because income excludes human capital
Indicate whether the statement is true or false
FALSE
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Assume someone organizes all farms in the nation into a single-price monopoly. What is the monopoly's marginal revenue curve?
A) It is a horizontal line at the competitive industry's price. B) It is a line that lies below the new monopoly's demand curve. C) It is a vertical line at the monopoly's chosen output level. D) It is identical to the demand curve for the monopolist's output. E) It is a line that lies above the new monopoly's demand curve.
If, for a given percentage increase in price, quantity demanded falls by a proportionately smaller percentage, then demand is
A) relatively elastic. B) relatively inelastic. C) perfectly elastic. D) unit elastic.
A decrease in the discount rate would:
A) decrease bank borrowing of reserves and reflect an expansionary monetary policy. B) decrease bank borrowing of reserves and reflect a contractionary monetary policy. C) increase bank borrowing of reserves and reflect an expansionary monetary policy. D) increase bank borrowing of reserves and reflect a contractionary monetary policy.
The fact that 80% of the assets accumulated during a lifetime are bequeathed to heirs in the United States suggests that
A) the appropriate time horizon for consumption theory is the lifetime of the earner. B) the appropriate time horizon for consumption theory is intergenerational. C) the Barro-Ricardo equivalence theorem is correct. D) it is true that higher taxes increase savings.