The distinguishing characteristic of private goods is that
A. they can be sold but not rented.
B. their use is exclusive to the people who purchase them.
C. the principle of rival consumption does not apply to them.
D. they can be sold or rented, but not borrowed.
Answer: B
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Suppose a 23-year old graduate student is looking for a full-time job , but has to take a part-time job instead. He or she will be categorized in the Current Population Survey as ________ when calculating the unemployment rate
A) employed B) a discouraged worker C) not in the labor force D) unemployed E) underemployed
Suppose the Fed conducts an open market purchase. We can expect this transaction to
A) reduce the money supply, increase bond prices, and lower interest rates. B) increase the money supply, lower bond prices, and lower interest rates. C) increase the money supply, raise bond prices, and lower interest rates. D) reduce the money supply, reduce bond prices, and increase interest rates.
If there's unemployment in the economy, then government policy should
a. increase taxes and cut spending, which would shift AD to the left b. increase taxes and spending, which would shift AD to the left c. decrease taxes and spending, which would shift AD to the right d. decrease taxes and increase spending, which would shift AD to the right e. increase taxes and cut spending, which would shift AS to the left
Suppose lower expectations lead to a decrease of $240 in desired investment in the economy and the marginal propensity to consume is 0.75.Table 10.2Spending CyclesChange in this Cycle's Spending and IncomeCumulative Decrease in Spending and IncomeFirst-cycle spending-$240-$240Second-cycle spending________________Third-cycle spending________________In Table 10.2, what is the cumulative decrease in expenditure by the end of the third cycle?
A. -$420.00. B. -$555.00. C. -$960.00. D. -$240.00.