A fall in the price of 7-UP that causes a household to shift its purchasing pattern away from Sprite and toward 7-UP is the ________ effect of a price change.
A. complementary
B. diminishing marginal utility
C. substitution
D. income
Answer: C
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Assume the United States is considering either a tariff or a quota to protect motorcycles
For each of the following groups, list whether they should prefer either the tariff or the quota, or be indifferent between the two: importer of motorcycles, taxpayers, foreign producer of motorcycles.
Suppose the production of VCRs can be represented by the following production function: q = L0.4 K0.4. Which of the following statements is (are) TRUE?
A) The production function has decreasing returns to scale. B) The marginal productivity of labor falls as labor increases in the short run. C) Capital and labor can be substituted for one another. D) All of the above.
Deciding how a society's products are distributed among its citizens answers the economic question of:
A. "Who consumes the products produced?" B. "What products will be produced?" C. "Where will the products be consumed?" D. "How will the products be produced?"
Refer to Table 27-4. Consider the hypothetical information in the table above for potential real GDP, real GDP, and the price level in 2016 and in 2017 if Congress and the president do not use fiscal policy
If Congress and the president use fiscal policy successfully to keep real GDP at its potential level in 2017, which of the following will be lower than if Congress and the president had taken no action? A) potential GDP and the inflation rate B) real GDP and the unemployment rate C) real GDP and potential GDP D) real GDP and the inflation rate