The theory of rational choice assumes that:
A. tastes do not matter.
B. tastes are given.
C. tastes do not affect the demand curve.
D. tastes influence the supply curve.
Answer: B
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Once the President submits his budget to Congress, there is little that the members of the House and Senate can do to change the budget
a. True b. False
Which one of the following transactions would be included in GDP?
a. Ms. Kim pays $50 for a used picture frame at a neighborhood garage sale. b. Mr. Doe donates $500 to his town's junior college scholarship fund. c. Ms. Bartolini pays $500 to fix the front end of her car damaged in a recent accident. d. Ms. Smith pays $5,000 to purchase 100 shares of Microsoft stock.
Suppose the economy has a recessionary gap. By using an expansionary monetary policy, the Fed can
A. raise the price level alone, but cannot increase real GDP. B. raise real GDP and the price level. C. raise real GDP without increasing the price level. D. raise real GDP and decrease the price level.
Refer to the scenario above. Which of the following will happen if Mike starts charging $30 for mowing lawns that were earlier mowed by their owners?
A) Per capita income will remain unchanged B) GDP will increase. C) GDP will decrease D) Per capita income will decrease. Edwin grows potatoes on his farm. A part of the output is consumed by Edwin's family and Edwin sells the remaining in the market.