A price floor is binding when it is set
a. above the equilibrium price, causing a shortage.
b. above the equilibrium price, causing a surplus.
c. below the equilibrium price, causing a shortage.
d. below the equilibrium price, causing a surplus.
b
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Spending on new housing, which economists refer to as residential fixed investment, is included in the consumption expenditures component of GDP
Indicate whether the statement is true or false
Quantitative analysis of relevant data show that economic problems for farmers in the last half of the 19th century included:
a. falling prices of farm products relative to other prices. b. rising real interest rates. c. rising prices for consumer goods. d. rising prices for farm equipment. e. All of the above
Adam Smith's ________ refers to the process by which individuals acting in their own self-interest bring about a market outcome that benefits society as a whole
A) Utopian society B) comparative advantage model C) invisible hand D) survival of the fittest theory
The cost of group health insurance is lower than if an individual buys a policy on his own because
A) moral hazard costs of a group tend to move to a low average. B) insuring a group eliminates the problem of buyers having more information than the seller. C) it is easier for the company to deny claims from a large group. D) the problem of adverse selection is reduced.