The notion that when the price of the good you want rises you will buy less of it because you will find another good that will do instead is provided as the explanation for
A. the substitution effect.
B. diminishing marginal utility.
C. the real-balances effect.
Answer: A
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A point or combination that is on the production possibilities frontier is
A. unattainable and efficient. B. attainable, but not efficient. C. unattainable, but not efficient. D. attainable and efficient.
If the interest rate is 4 percent, the present value of $10,000 to be received one year from today is about
A) $9,246. B) $9,615. C) $10,816. D) $10,400.
All of the following aim to reduce income inequality EXCEPT
A) Social Security payments. B) earned income tax credits. C) regressive taxes. D) food stamp programs.
Which of the following is projected to rise from 8.3 percent of GDP in 2009 to about 13 percent by 2035 and about 20 percent in 2080?
a. Defense spending b. Medicare and Social Security spending c. interest payments on national debt d. infrastructure spending