If total output is calculated by adding up the market value of goods and services produced, then more expensive items:
A. receive the same weight as cheaper items.
B. receive a smaller weight than cheaper items.
C. receive a greater weight than cheaper items.
D. are double counted.
Answer: C
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A worldwide hops (a flowers used in brewing) shortage made stouts, ales and other specialty microbrews more pricy in 2008. Gayle Goshie, a hops farmer, blames overproduction for hops' previously cheap place on the agricultural market
The glut pushed many hop farmers out business, which gradually helped hop prices recover. Suppose farming hops is a perfectly competitive market. Why would some hop farmers go out of business? A) because the price of hops was below the minimum of average fixed cost B) because the price of hops was lower than the minimum of average variable cost C) because the price of hops was higher than the minimum of average variable cost D) because the price of hops was lower than the minimum of average total cost
Which of the following statements best describes “bracket creep” within the U.S. income tax code?
a. Until the late 1970s, if real wages increased along with inflation, people were moved into higher tax brackets and owed a higher proportion of their income in taxes, even though their nominal income had not risen. b. After the late 1970s, if real wages increased along with inflation, people were moved into higher tax brackets and owed a higher proportion of their income in taxes, even though their nominal income had not risen. c. Until the late 1970s, if nominal wages increased along with inflation, people were moved into higher tax brackets and owed a higher proportion of their income in taxes, even though their real income had not risen. d. After the late 1970s, if nominal wages increased along with inflation, people were moved into higher tax brackets and owed a higher proportion of their income in taxes, even though their real income had not risen.
Economic analysis indicates that the increasing government expenditures and growth of third-party payments accompanying the Medicare and Medicaid programs
a. reduced the demand for healthcare services. b. reduced the incentive of consumers to economize on their use of healthcare. c. increased the incentive of consumers to economize on their use of healthcare. d. placed downward pressure on the prices of healthcare services.
Moral hazard is best described as
A. an action by an individual that endangers others. B. an action that puts one’s salvation at risk. C. the presence of insurance increasing risk-taking behavior. D. vigilance by individuals to keep total insurance claims at a minimum to keep rates low.