According to Adam Smith, what is the primary source of a nation's wealth?
A. the amount of gold and silver in the government's possession
B. a spirit of cooperation in which people share according to their means
C. strong central planning authorities
D. the people's ability to produce products and trade in free markets
Answer: D
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Studies show that the income elasticity of demand for wine is approximately five. What does this mean?
A) A 1 percent increase in income leads to a 5 percent increase in wine consumption. B) A 1 percent decrease in the price of wine leads to a 5 percent increase in wine consumption. C) A 5 percent increase in income leads to a 1 percent increase in wine consumption. D) Wine is a relatively elastic good.
The underground economy exists for all of the following reasons EXCEPT The
a) avoidance of government regulation b) production of illegal goods c) desire to maintain accurate records of economic transactions d) avoidance of taxes
Recall the Application about the short-run and long-run elasticity of supply of coffee to answer the following question(s). Recall the Application. In the long run, the supply curve for coffee is ________ and the elasticity of supply is ________ than in the short run.
A. steeper; larger B. steeper; smaller C. flatter; larger D. flatter; smaller
The 1996 Farm Act actually increased the level of government assistance to farmers.
Answer the following statement true (T) or false (F)