Suppose a family's budget line is such that the horizontal axis shows the amount of food consumed, while the vertical axis measures the consumption of all other goods. Suppose this family receives food stamps. This will cause the budget line to
A. shift leftward.
B. rotate leftward along the vertical axis.
C. shift rightward along the horizontal axis.
D. pivot along the horizontal axis.
Answer: C
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The government of Economica announces that it will purchase its farmers’ surplus of milk. From this announcement, you can infer that Economica has a
A. free market for milk. B. price ceiling above the equilibrium price for milk. C. price floor above the equilibrium price for milk. D. price floor below the equilibrium price for milk.
A monopsony owner believes that hiring an additional worker would increase the company's revenue by $150 per day. We can conclude that the monopsony pays its workers:
a. more than $150 per day. b. exactly $150 per day. c. less than $150 per day. d. exactly $75 per day.
Contractionary monetary policy refers to an insurance system that makes sure depositors in a bank do not lose their money, even if the bank goes bankrupt
a. True b. False Indicate whether the statement is true or false
Compared to a proprietorship, a disadvantage of a partnership is
A. that potential liability to each partner is greater. B. that profits are taxed twice. C. unlimited liability. D. that it is harder to keep the firm going after the death of an owner.