Explain how a market demand curve is constructed
What will be an ideal response?
The market demand curve is the horizontal summation of the individual demand curves. A price is selected, and the quantities demanded of each person at that price are summed. Then another price is selected and the quantities demanded of each person at that price are summed. Continue doing this for other prices until the market demand curve is traced out.
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From the 1950s to the 2010s, transfer payments' share of GDP
A) steadily increased. B) steadily decreased. C) remained fairly steady. D) increased during Democratic administrations and decreased during Republican administrations.
Insurance companies try to mitigate the problem of adverse selection by:
A. asking potential customers a seemingly endless list of questions to gain as much information as they can about the person's risk characteristics. B. charging a higher premium to groups with similar ages or behaviors that correlate with risky behavior. C. charge a higher price to all individuals to cover the lack of information. D. All of these statements are true.
Opportunity cost exists because of
A) poverty. B) scarcity. C) greed. D) self-interest.
Technological improvements in coal mining will
A) increase the price of coal. B) decrease the price of coal. C) increase the interest rate. D) decrease the interest rate.