The federal budget
A) is required to balance by law.
B) can have a surplus but not a deficit.
C) can have a deficit but not a surplus.
D) can have a deficit or a surplus but cannot be balanced.
E) can have a deficit, a surplus, or a balance.
E
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Explain the income effect and the substitution effect due to an increase in the wage rate
What will be an ideal response?
Refer to Figure 10-4. What is the marginal rate of substitution for one bar of chocolate between g and h?
A) of a cookie. B) of a cookie. C) 2 cookies. D) 3 cookies.
The saving schedule shows the relationship of saving of households to the level of:
a. Consumption b. The average propensity to save c. Investment d. Disposable income
If the insurance company offers the insurance for $1,500, then the theory of adverse selection predicts that
Suppose that Dirk and Rollergirl are both considering purchasing insurance. Dirk's "expected loss" is equal to $1,600. Rollergirl's expected loss is equal to $1,200. Also, both Dirk and Rollergirl are "risk averse," and so each of them is willing to buy insurance for an amount that's up to $200 in excess of his/her expected loss. A. both of them will agree to purchase the insurance. B. dirk will purchase the insurance, but Rollergirl will decide that it's too expensive. C. neither one of them will agree to purchase the insurance. D. both of them will agree to purchase the insurance, but the insurance company will still lose money regardless.