Engel's law states that income elasticities are
a. negative for normal goods
b. positive for inferior goods
c. higher for food in industrialized nations than in nonindustrialized nations
d. less than one for food
e. usually about equal to one
D
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Answer the following statement(s) true (T) or false (F)
1. Good fringe benefits will cause a rightward shift of a firm’s labor supply curve. 2. Monopsony exists when demand for labor and the quantity of labor supplied are at equilibrium. 3. Monopsony is considered good for workers because it evens out the difference between union and nonunion wages. 4. Membership in labor unions is higher in the private sector than in the public sector. 5. The percentage of workers who are union members has decreased dramatically since the 1970s.
If production in the economy is efficient, then changes in market prices
A. Move us to a point above the production possibilities curve. B. Move us from a point below the production possibilities curve to a point on the production possibilities curve. C. Have no effect on our position on the production possibilities curve. D. Move us along the edge of the production possibilities curve.
An example of a commitment device for Jane, who says she really wants to save more would be:
A. an agreement that she give any new clothes, jewelry, or makeup purchases to her best friend, and Jane is not allowed to borrow them. B. a decision to cook her own food and not order take-out or delivery food unless she is too busy. C. a commitment to only buy things on sale. D. buying a piggy bank to store savings.
"Exotic" mortgages require a down payment of at least 20%.
Answer the following statement true (T) or false (F)