The consumption function shows the relationship between
A) interest rates and planned real consumption.
B) employment and planned real consumption.
C) the price level and planned real consumption.
D) real disposable income and planned real consumption.
D
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The situation in which one party to a transaction takes advantage of knowing more than the other party to the transaction is known as asymmetric information
Indicate whether the statement is true or false
A bountiful wheat harvest can be bad news for wheat farmers because the a. supply curve for an individual wheat farmer is usually perfectly elastic
b. supply curve for an individual wheat farmer is usually perfectly inelastic. c. demand for wheat is usually inelastic, meaning that factors that shift supply curve to the right decrease total revenues to sellers. d. demand for basic wheat is usually elastic, meaning that factors that shift supply to the right increase total revenues to sellers.
Suppose there are two factories on a river, and both need clean water for their production processes. The upstream factory takes in clean water and dumps dirty water back into the river. The downstream firm must clean up the water it gets from the river
before using it. In this situation A) the private costs of the downstream factory are more than the private costs of the upstream factory, but for both factories private costs and social costs are the same. B) the social costs are greater than the private costs for the upstream firm, while the social costs are less than the private costs for the downstream firm. C) the upstream factory's private costs are less than its social costs, and its external costs are borne by the downstream factory. D) the internal costs of the upstream factory are externalized by the downstream factory, which then passes them on to its customers.
A consumer has been buying 2 magazines and 2 books a month for many months. The price of books then increases. To attain a new optimum, the consumer will
A. buy more books because they are now relatively more valuable than they were before. B. buy the same number of books and magazines as before because they provide different types of utility. C. buy fewer books than before because they are relatively more expensive than they were before. D. buy more magazines because they are now relatively more valuable than they were before, while continuing to buy the same number of books.