A balanced budget is present when:
a. the economy is at full employment.
b. the actual level of aggregate spending equals the planned level of spending.
c. public sector spending equals private sector spending.
d. government revenues equal government expenditures.
d
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________ is concerned with the distribution of resources across society
A) Social surplus B) Equity C) Efficiency D) Utility
Consider the game between the teens from the previous question. Instead of being a simultaneous game, suppose it is sequential, with teen A moving first. What is the subgame-perfect equilibrium of this new game?
a. Both Declare. b. Both Ignore/Rebuff. c. It is a mixed strategy equilibrium. d. Teen A Declares and Teen B follows A's action.
Which of the following best describes how consumers and potato farmers in Spudville might be affected by imports of low-cost potatoes from Potato Town?
a. Prices fall in Spudville, but those losses are balanced by gains in Potato Town. b. Potato prices drop, which is helpful for consumers but a challenge for farmers. c. Potato farmers and consumers in Spudville both benefit from the cheap imports. d. Potato prices rise, but losses to consumers are offset by the benefits to farmers.
Consider two coupons: one offers 10 percent off a pair of jeans that costs $100, and the other offers 50 percent off a pair of sunglasses that costs $20. Using either coupon requires driving to the shopping mall across town. According to the Weber-Fechner law, which coupon will people tend to perceive as being more valuable?
A. The coupon for the jeans since $100 is greater than $20. B. They will be seen as equally valuable since both lead to a savings of $10. C. The coupon for the sunglasses since 50 percent is greater than 10 percent. D. Neither coupon will be of value to anyone since both require driving across town.