Which of the following describes the Giffen good case? When the price of the good
A) rises, the income effect is opposite to and greater than the substitution effect, and consumption falls.
B) falls, the income effect is in the same direction as the substitution effect, and consumption rises.
C) falls, the income effect is in the opposite direction to the substitution effect, and consumption falls.
D) falls, the income effect is in opposite direction to the substitution effect and consumption rises.
E) Both A and D are correct.
C
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Which of the following issues prominent in the presidential election of 2012 shifts the aggregate demand curve rightward?
A) raising taxes on the rich B) increasing Medicare, Medicaid, and Social Security payments C) loosening immigration policies D) allowing more oil drilling on Federal lands
Exports are not included in GDP because they do not reflect domestic consumption
a. True b. False Indicate whether the statement is true or false
Jerome, the florist, sold 500 bridesmaid's bouquets in June. He estimates his costs that month were ATC = $10, AVC = $6, and MC = $9 . If he sold each bouquet at the constant market price of $9, Jerome
a. made an economic profit of $500 b. made a loss of $500 c. made an economic profit of $1,500 d. made a loss of $1,500 e. should have shut down in June
Explain why individuals make choices that are directly on the budget constraint, rather than inside the budget constraint or outside it.
What will be an ideal response?