Economists argue that markets serve the interests of society primarily because
A. producers are made better off (regardless of whether consumers are made better off).
B. money is made available for government.
C. consumers are made better off (regardless of whether producers are made better off).
D. both consumers and producers are made better off.
Answer: D
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In the United States in 2013, the Bureau of Economic Analysis began counting spending on research and development as ________, which counts as a part of GDP
A) intermediate goods B) investment C) consumption D) depreciation
Governments prefer to avoid excessive current account surpluses because
A) the returns to domestic savings are more difficult to tax than those on assets abroad. B) an addition to the home capital stock may increase domestic unemployment and therefore lead to higher national income. C) foreign investment in one firm may have beneficial technological spillover effects on other foreign producers that the investing firm does not capture. D) an addition to the home capital stock may reduce domestic unemployment and therefore lead to higher national income. E) domestic savings increase with more investment abroad.
When Bo increases the consumption of Good X and decrease the consumption of Good Y, her marginal utility of
A) X falls and the marginal utility of Y will increase. B) both X and Y will decrease. C) X increases and the marginal utility of Y will fall. D) both X and Y will increase.
Assume that households have positive wealth. As the interest rate ________, nonlabor income ________ and current consumption ________.
A. decreases; increases; decreases B. decreases; decreases; decreases C. increases; decreases; increases D. increases; increases; decreases