In a simple macroeconomic model, only one component of expenditures is allowed to change:
a. investment.
b. consumption.
c. net exports.
d. government spending.
e. transfer payments.
b
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The invention of a machine that increases milk production is discovered. If farmers were to decry the effect of this new technology on the price of milk and lobby government to set the price of milk at the price before the invention, what would be the result?
A. A decline in the price of milk B. Excess demand for milk C. Excess supply of milk D. Neither a shortage nor a surplus of milk
Why were economists concerned about the timing of President Trump's major tax cut law that was enacted in December 2017?
What will be an ideal response?
The expression "getting the most bang for your buck" is an illustration of the
A. marginal utility/total utility ratio. B. total utility/price ratio. C. marginal utility/price ratio. D. total utility/marginal utility ratio.
Under rate-of-return regulation, average cost pricing
A. is inflated so the firm can make economic profits. B. includes what they consider to be a fair rate of return on investment. C. includes a cost for capital that generates an above normal rate of return. D. includes variable costs but not a cost for capital.