When compared to the price of laptop computers, college tuition in the United States has
A. fallen.
B. risen.
C. stayed the same.
D. risen at the same rate as the CPI.
Answer: B
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Refer to Table 3-2. The table above shows the demand schedules for cashews of two individuals (Jordy and Amy) and the rest of the market. If the price of cashews falls from $4 to $2, the market quantity demanded would
A) increase by 28 lbs. B) decrease by 36 lbs. C) decrease by 28 lbs. D) increase by 36 lbs.
An example of a situation in which the social costs are greater than the private costs would be
A) a new restaurant takes business away from an established restaurant. B) hand-held calculators putting slide rule manufacturers out of business. C) when a member of a rock band's ability to hear deteriorates from performing in so many loud concerts. D) a physician who cannot examine patients with a stethoscope in an examination room adjacent to an airport.
The ability-to-pay principle of taxation:
A. suggests that people should pay taxes in proportion to the benefits they derive from public goods and services. B. has been declared unconstitutional because it deprives individuals of property without due process of law. C. suggests that the tax burden should vary directly with people's income and wealth. D. suggests that the tax burden should vary inversely with people's income and wealth.
One difference between the demand for a private good and that for a public good is that
A) with a private good, each consumer chooses the quantity she wants to consume but with a public good, everyone consumes the same quantity. B) the marginal benefit from consuming the last unit of a public good always exceeds the marginal benefit from consuming the last unit of a private good because there are externalities in the consumption of the public good. C) with a private good, each consumer receives different amounts of benefit from consuming the product but with a public good, every consumer realizes the same amount of benefit from consuming the product. D) with a private good, each consumer chooses the quantity she wants to consume but with a public good, each consumer chooses the price she is willing to pay for a fixed quantity.