The public assistance program that economists believe can promote economic equality at the least cost in economic efficiency is
a. Aid to Families with Dependent Children (AFDC).
b. a negative income tax (NIT).
c. food stamps.
d. Medicaid.
b
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The employment effect of a minimum wage increase is greater the
A. more elastic the demand for labor. B. less elastic the demand for labor. C. more the wage ceiling shifts the supply curve. D. more the wage floor shifts the demand curve.
One thing that distinguishes normative economic principles from positive economic principles is that:
A. normative principles are pessimistic and positive principles are optimistic. B. normative principles tell us how people should behave, and positive principles tell us how people will behave. C. normative principles tell us how people will behave, and positive principles tell us how people should behave. D. normative principles reflect social norms, and positive principles reflect universal truths.
Decreases in the stock of capital will lead to
A) decreases in wages and GDP. B) increases in wages and total GDP. C) decreases in wages and increases in GDP. D) increases in wages and decreases in GDP.
If the federal government increases the amount of Social Security benefits for retired persons, then the
a. consumption schedule will shift upward. b. aggregate demand curve will shift outward. c. effect on equilibrium GDP will be the same as a cut in taxes. d. All of the above are correct.