Institutional barriers that impede human and physical capital investment are known as
A. The discouraged worker gap.
B. An illiteracy trap.
C. The human capital effect.
D. An inequality trap.
Answer: D
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The largest expenditure category in the United States is
A) consumption expenditure. B) wages. C) net exports of goods and services. D) government expenditure on goods and services. E) investment.
The measured distribution of income today appears more unequal than in the 1950s partly because of: a. an increase in the rate of divorce
b. an increase in the number of two-income families. c. a reduction in the divorce rate. d. both (a) and (b).
National saving
a. is the total income in the economy that remains after paying for consumption. b. is the total income in the economy that remains after paying for consumption and government purchases. c. is always greater than investment for a closed economy. d. is equal to private saving minus public saving.
Your economics professor has announced that he or she will assign final grades as follows: the top 20 percent of students will get an A, the bottom 20 percent of students will get an F, and everyone else will get a C. This grading scheme generates a positional externality because:
A. each student's final grade depends on his or her relative standing. B. studying requires both time and effort. C. society as whole will be better off when people are educated. D. students will study hard no matter how the professor assigns final grades.