In the classical model, the government needs to worry about employment
a. True
b. False
B
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For many years short wave radios were a way of getting news from faraway places and in difficult conditions. But as new technologies have spread, the people listening to these devices has decreased
(Source: The Economist, July 7, 2012) As new technology creates substitutes for short-wave radios, the demand for short-wave radios ________ and the consumer surplus from short-wave radios ________. A) increases; increases B) decreases; decreases C) does not change; decreases D) decreases; does not change
If we want to use a measure of inflation that foreshadows price changes before they affect prices at the retail level, we would base our measure of inflation on
A) the household price index. B) the GDP deflator. C) the producer price index. D) the consumer price index.
In behavioral economics, the endowment effect refers to
A) most people believe that most wealthy people inherit their wealth. B) many people would be indifferent between being endowed with money or knowledge. C) many people place a higher value on what they own than when they consider purchasing. D) most people respond to tax incentives to provide an endowment for their children.
GDP underestimates our economic well-being:
a. for of all the following reasons. b. because it includes the value of work done by nannies. c. because it ignores leisure. d. because it includes the value of work done by householders. e. because it includes the value of work done by illegal immigrants.