Examples of transfer payments are
A. federal government spending for national defense.
B. wages, profits, and rents.
C. salaries of educators, police, and firefighters.
D. Social Security checks and unemployment insurance payments.
Answer: D
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The purchase of Michelin Tire Company by General Motors is an example of a horizontal merger
a. True b. False Indicate whether the statement is true or false
Waterview Corp, a local water supplier, incurs a fairly minimal marginal cost to provide water services to an additional home in its area of operation. This implies that the water supplier: a. experiences economies of scale
b. has inferior technology. c. has an infinite stock of raw materials. d. practices perfect price discrimination.
Suppose France subsidizes French wheat farmers, while Germany offers no subsidy to German wheat farmers. As a result of the French subsidy, sales of French wheat to Germany
a. may prompt German farmers to invoke the unfair-competition argument. b. increase the consumer surplus of German buyers of wheat. c. increase the total surplus of the German people. d. All of the above are correct.
In Latin America, countries like Brazil and Mexico have found it necessary to grant their central banks more independence in order to
A. maintain higher levels of political stability. B. promote economic growth and employment. C. counteract high rates of inflation. D. deal with the consequences of globalization.