The value of an original painting, held as an asset, increased in value by 100 percent from 1970 to 2010. Suppose during the same period average prices in the economy rose by 150 percent. The owner of the painting, relative to those who do not own paintings, experienced a:
A. Higher real income as a result of the wealth effect.
B. Higher real income as a result of the price effect.
C. Lower real wealth as a result of the wealth effect.
D. Lower real income as a result of the income effect.
C. Lower real wealth as a result of the wealth effect.
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Joe is shopping for a new computer. A computer can be delivered to Joe's home for $1,200. Alternatively, Joe can pick up the same computer at the warehouse for $1,000. How should Joe buy the computer?
A. Joe should drive to the warehouse because $1,000 is less than $1,200. B. Joe should drive to the warehouse if his cost of driving to the warehouse is less than $200. C. Joe should drive to the warehouse because the $200 he would save by driving to the warehouse is more than 10% of the purchase price. D. Joe should drive to the warehouse if his cost of driving to the warehouse is greater than $200.
Investment in health care does bear similarities to investment in human or physical capital
a. True b. False Indicate whether the statement is true or false
Which of the following is not an advantage of flexible exchange rates?
a. Flexible exchange rates provide businesses with protection against business risks associated with monetary base and the money supply changes. b. Flexible exchange rates provide businesses with protection against business risks associated with exchange rate changes. c. Flexible exchange rates absorb economic shocks. d. Flexible exchange rates allow a nation to pursue an independent monetary policy.
Economic progress
A) reflects that people are achieving higher income levels and living standards. B) requires that individuals work longer hours. C) indicates that scarcity is no longer a problem. D) indicates income levels are higher even though environmental and health conditions have worsened.