Government purchases of goods and services do NOT include
A. the military payroll.
B. purchases of final products.
C. purchases by state governments.
D. welfare payments.
D. welfare payments.
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Refer to Figure 14-1. Should Lexus lower its price in order to deter BMW's entry into the luxury hybrid automobile market?
A) Yes, it will drive BMW out of the market. B) No, it should keep the same price and work to capitalize on its brand loyalty. C) In terms of profit earned, it makes no difference whether Lexus lowers its price or not; in either case it will make $280 million profit if BMW enters. D) No, because BMW will enter the market regardless of Lexus' decision about its price.
Elasticity is a measure of:
a. the slope of a linear demand curve. b. the slope of a supply curve. c. relative responsiveness. d. economic welfare. e. consumer tastes.
If the MPC is 0.9, and the government cuts spending by $200b, the overall effect on GDP will be:
A. a decrease of $2,000b. B. an increase of $2,000b. C. a decrease of $1,800b. D. an increase of $180b.
Forms of historical government intervention in agriculture includes
A) Foreign trade enhancements. B) Price and income support payments. C) Adjusting production to market demand. D) All of the above.