According to the law of demand, a decrease in the price of a good causes
A. an upward movement along the demand curve for that good.
B. a rightward shift of the demand curve for that good.
C. a downward movement along the demand curve for that good.
D. a leftward shift of the demand curve for that good.
Answer: C
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To help pull an economy out of a recession and put additional income in the hands of the public, a government can force its expenditures to ________ its revenues and create a ________
A) reduce; deficit B) exceed; special taxes C) stimulate; depression D) exceed; deficit
The nominal GDP of the U.S. in 2015 was approximately $17.3 trillion. This means that
A) total income in 2015 was around $17.3 trillion. B) total spending in 2015 was around $17.3 trillion. C) the value of output in 2015 was around $17.3 trillion. D) all of the above are true.
At the point at which P=MC, suppose that a perfectly competitive firm's MC = $100, its AVC = $80 and its AC = $110. This firm should
A) shut down immediately. B) continue operating in the short run. C) try to take advantage of economies of scale. D) try to increase its advertising and promotion.
Under current tax laws, individuals do not pay taxes on health insurance benefits they receive from their employers. As a result
A) the federal government spends more than it receives in tax revenue. B) individuals are encouraged to want generous health coverage that reduces their incentives to cut costs. C) the quality of health care provided is less than it would be if benefits were taxed. D) politicians are encouraged to raise income and payroll taxes.