Compared to higher-income families, low-income families would demand proportionately more of which of the following kinds of goods?
a. Luxury goods.
b. Substitute goods.
c. Normal goods.
d. Inferior goods.
d
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In order to isolate the substitution effect of a price increase, a consumer
a. must be given a lower price on the other good so that he can achieve his original indifference curve. b. must be given enough of the other good so that his consumption of that good is not influenced. c. must be given enough additional income to allow him to achieve his original indifference curve. d. must be given enough additional income to allow him to purchase the original quantity of the good.
Total efficiency units of labor is:
A) obtained by multiplying the total number of workers in the economy by the average efficiency of each worker. B) obtained by dividing the total capital stock of the economy by the total number of workers. C) obtained by multiplying the total population of the economy by the average amount of capital available to each worker. D) obtained by dividing the total number of workers in the economy by the average efficiency of each worker.
The difference between a private good and a public good is that
A) private goods are government-sponsored goods while public goods are government-inhibited goods. B) externalities are always created in the production process but not in the production of public goods. C) private goods make us happy while public goods do not. D) the exclusion principle applies to a private good but not to a public good.
The quantity supplied of a good
a. is the amount that sellers would provide if the firms faced no constraints b. is the amount that sellers would provide if input prices were zero c. must match the amount actually purchased in the market d. is a fixed amount unaffected by the sellers' circumstances e. is subject to the constraints imposed by technology and input prices