Answer the following statement true (T) or false (F)
1) Demand is the active and supply the passive determinant of land rent.
2) Different rents on land reflect differences in the marginal revenue product of land.
3) The free-land era of U.S. history reflected a situation in which the quantity of land available at a zero price exceeded the quantity of land demanded.
4) Rent performs an incentive function, but no rationing function.
5) The interest rate is the price paid for the use of money.
Answer:
1) True
2) True
3) True
4) False
5) True
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Before an uneven rise in prices Allan consumed 5 bread and 6 juice. After the price increase and with an increased welfare payment from the government Allan consumes 4 bread and 7 juice
Does the government payment represent a true cost-of-living adjustment (COLA)? A) Yes, if the two consumption bundles lie on the same indifference curve. B) Yes, if the second bundle yields more utility than the first. C) No, the first bundle is clearly preferred. D) Not enough information.
A movie theatre raises its admission prices by 10%, which results in a 10% reduction in the quantity of tickets demanded. The demand curve facing this firm is: a. elastic
b. inelastic. c. unit elastic. d. unit inelastic.
The economic system that is generally considered to be the most efficient at answering the What to produce and the How to produce questions is the:
A. market economy. B. command economy C. soviet economy. D. traditional economy.
All of the following are automatic stabilizers EXCEPT
A. unemployment compensation. B. income transfer payments. C. discretionary increases in government spending. D. progressive income tax system.