The trend back toward greater inequality in the 1970s and 1980s was caused by:
A. a fall in the real income of the poor.
B. a rise in the real income of the poor.
C. a movement toward progressive taxation.
D. an increase in government funding for social programs.
Answer: A
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For a person to keep his real income steady at a certain level from one year to the next, his nominal income must
A. stay the same as the price index rises. B. rise as fast as the price index. C. rise if the price index falls. D. fall if the price index rises.
Which of the following results in a "parallel" shift outward of your indifference curves between gasoline and movie rentals?
A) any decrease in the prices of gasoline and movie rentals B) an equal percentage decrease in the prices of gasoline and movie rentals C) an increase in your income D) none of the above
You are shopping at the local mall with an $80 gift certificate. Only three items catch your attention. The items include a Justin Bieber sheet set, a remote control helicopter, and an "Amazing Ab Belt." You would be willing to give up $60 for the sheets, $70 for the belt, and $80 for the helicopter. Knowing this, you decide to purchase the helicopter. The opportunity cost of the helicopter was:
A. $130, the combined value of the alternatives forgone. B. $80, the amount of the gift certificate spent. C. $70, the value of the ab belt. D. $60, the value of the sheets.
A firm announces that it will refund the difference between its price and any price of a competitor that is lower. This is an example of:
A. predatory pricing. B. tying contracting. C. marginal cost pricing. D. a low-price guarantee