People tend to earn higher incomes as they mature and gain experience in the workforce. As a consequence of this income mobility,
A. statistics on income may overstate inequality.
B. the overall poverty rate may rise as the population ages.
C. redistribution of income may encourage innovation and economic growth.
D. statistics on income may understate inequality.
Answer: A
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The inflation rate measures the
A) average price of the goods and services consumed by urban consumers. B) percentage change in the CPI from one year to the next year. C) cost of the CPI market basket at current period prices divided by the cost of the CPI market basket at base period prices. D) percentage change in the quantity of goods and services consumed by urban consumers. E) cost of the CPI market basket at base period prices divided by the cost of the CPI market basket at current period prices.
The theory that there is no predictable trends in securities prices is the
A) opportunity cost of capital. B) random walk theory. C) capital reinvestment. D) present value.
The real interest rate can be expressed as the:
a. nominal interest rate minus the real interest rate. b. inflation rate minus the nominal interest rate. c. nominal interest rate minus the inflation rate. d. nominal interest rate plus the inflation rate.
Pharmaceutical development provides a good example of rent-seeking behavior, the pursuit of which results in _______.
a. lower economic activity by diverting resource to less-productive uses b. lower prices throughout the economy c. increased economic activity by promoting efficiency d. a more equitable distribution of income and wealth e. greater income and wealth in the private se