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
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Balance of payments accounts include
A) the net interest income account. B) the current account. C) Both answers A and B are correct. D) Neither answer A nor B is correct.
A data lag
What will be an ideal response?
Irene is a vegetarian, so she does not eat pork. That is, pork provides no additional utility to Irene. She loves broccoli, however. If we illustrate Irene's indifference curves by drawing broccoli on the horizontal axis and pork on the vertical axis, her indifference curves will
a. slope downward. b. be vertical straight lines. c. slope upward. d. be horizontal straight lines.
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What will be an ideal response?