Consumption expenditures do not include household purchases of
A) medical care.
B) education.
C) new houses.
D) durable goods.
Answer: C
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Which of the following best defines productive efficiency?
a. Producing without waste b. Producing what society prefers c. Selling goods at the lowest cost d. Competing with identical goods
If a 10-year Treasury bond pays 3.1% and a 10-year corporate bond pays 7.4%, what is the interest rate spread on this particular corporate bond?
a. 4.3% b. 7.4% c. 10.5% d. 22.9%
If Ethan thinks the last dollar spent on bowling yields more satisfaction than the last dollar spent on hamburgers, and Ethan is a utility-maximizing consumer, he should
a. bowl less, so the marginal satisfaction from expenditures in this area will increase. b. spend more on hamburgers, so total satisfaction from that activity will increase. c. eliminate spending on hamburgers. d. bowl more and spend less on hamburgers.
Price elasticity of demand is generally:
A. greater in the long run than in the short run. B. greater in the short run than in the long run. C. the same in both the short run and the long run. D. greater for "necessities" than it is for "luxuries."