If the quality of a good improves while its price remains the same, then the value of a dollar
a. rises and the cost of living increases.
b. rises and the cost of living decreases.
c. falls and the cost of living increases.
d. falls and the cost of living decreases.
b
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Assume there is a simultaneous decrease in the incomes of people in the market for new homes and a decrease in the wages paid to carpenters, plumbers, and electricians
All else constant, we can predict, with certainty, that in the market for new homes the equilibrium: A) quantity of new homes will decrease. B) quantity of new homes will increase. C) price of new homes will decrease. D) price of new homes will increase.
Marginal revenue
A) cannot be used to determine the profit-maximizing rate of production. B) is the change in total revenues resulting from a change in output. C) is a change in revenue that is immeasurable and non-quantifiable. D) cannot be effectively utilized when analyzing the perfect competitor.
Adverse selection in insurance requires that
a. potential customers face different levels risk b. potential customers facing more risk are no more interested in purchasing insurance c. people are not risk averse d. insurers can tell higher risk people from lower risk people
Since half of the FICA tax is paid by firms and the other half is paid by workers, the burden of the tax must fall equally on firms and workers
a. True b. False Indicate whether the statement is true or false