A well-known women's college whose tuition lagged below similar schools found recruiting difficult and enrollment falling. A substantial tuition increase was implemented, and dormitories were soon full again. This can be explained by
a. the law of demand.
b. the fact that education at the school was an inferior good.
c. the fact that people sometimes base perceptions of quality on price (snob effect).
d. elastic demand.
c
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Explain the connection between property rights and economic growth
What will be an ideal response?
Refer to Figure 23-2. Suppose that the level of GDP associated with point K is potential GDP. If the U.S. economy is currently at point N,
A) firms are operating below capacity. B) the economy is in an expansion. C) the level of unemployment is above the natural rate. D) the economy is at full employment.
Which group came out of World War I (1914–18) better off?
(a) Industrial and agricultural workers (b) Creditors (c) Individuals depending on investment (d) People living on fixed incomes
The cost of building a new interstate highway system is reported to be high at $25 billion. Does it necessarily follow that the interstate highway is not worth building?
A) Yes, because it is better to spend $25 billion on ending poverty than on building another interstate highway system. B) No, because building a new interstate highway system promotes economic growth, which helps everyone. C) No, because the benefits of building a new interstate highway system may be greater than $25 billion. D) Yes, because the benefits of building a new interstate highway system may be greater than $25 billion.