The relationship between a consumer's monthly income and monthly consumption of four products, A-D, is shown below.IncomeQuantity Consumed?ABCD$4,00045902005,000601801015Which product listed is an example of an inferior good?
A. A
B. B
C. C
D. D
Answer: C
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When government decides to increase spending, interest rates generally ________ and this change in interest rates ________ investment spending
A) increase; increases B) increase; decreases C) decrease; increases D) decrease; decreases
Accelerated depreciation laws may increase firms' investment in equipment because
a. machines will wear out more rapidly. b. profits will be increased. c. the rental rate on capital will be lowered. d. the price of machines will fall.
When a market is corrected for externalities, it:
A. is equitable. B. maximizes surplus. C. makes everyone in society better off. D. All of these statements are true.
Unscrupulous managers have learned ways to manipulate stock options and undermine their benefits to stockholders. Discuss some provisions that could be built into the process to curb such practices