How does advertising signal to consumers that the product is a good one?
a. By seeing famous people using the product, consumers infer that they too can be famous.
b. By being willing to spend money on advertising, firms let consumers know the product is likely a good one since firms would not likely advertise a poor product.
c. By making consumers laugh during commercials, firms are associating positive experiences with the product.
d. Without allowing consumers to actually use the product, it is not possible for firms to signal to consumers the product's quality.
b
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If private consumption in the United States was 69 percent of GDP, investment was 18 percent, government purchases were 18 percent, exports were 9 percent, and imports were 14 percent, net exports were equal to ____ percent of GDP
a. -5 b. 5 c. -23 d. 23
Knowledge that is patented is a
a. public good, whereas knowledge that is not patented is a common resource. b. private good, whereas knowledge that is not patented is a club good. c. common resource, whereas knowledge that is not patented is a private good. d. club good, whereas knowledge that is not patented is a public good.
Which of the following is NOT related to the government's political function of income redistribution?
A) providing money transfer payments
B) excise tax on gasoline
C) Social Security
D) in-kind transfers
A relative price shift occurs when
A. the inflation rate of a good or service is significantly higher or lower than the overall inflation rate. B. the inflation rate of a good or service matches the overall inflation rate. C. the inflation rate of a good or service remains unchanged. D. inflation exceeds the average revenue per capita.