If a consumer has allocated income between pizzas and movies such that utility is maximized, and the price of pizza falls, when equilibrium is restored this consumer will:
a. consume less pizzas and the same amount of movies.
b. consume less pizzas and more movies.
c. consume more movies.
d. consume more pizza.
d
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The first step toward reducing negative externalities or maintaining them within acceptable bounds, according to the argument of the textbook, is
A) constructing an exhaustive list of all negative externalities. B) creating a central planning authority for negative externalities. C) cultivating such civic virtues as courtesy and tolerance. D) halting population growth. E) prohibiting activities whose costs are greater than their benefits.
The total debt includes amounts one government agency owes to another
a. True b. False
The velocity of money is
a. money supply divided by prices. b. spending divided by output. c. required monetary reserves divided by income. d. GDP divided by the money supply.
A newspaper reports that in an urban area the average price of new homes had decreased, but the number of new homes sold had increased. This situation would best be explained by a(n):
a. Increase in supply b. Decrease in demand c. Increase in demand d. Decrease in supply