The replacement of the phonograph by the cassette tape player and the eventual replacement of the latter by CD and MP3 players is an example of
a. economies of scale.
b. planned obsolescence.
c. diseconomies of scale.
d. creative destruction.
D
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The rising minimum wage allegedly has reduced the quantity demanded of teenage labor. However, demographics slightly reduced the supply of teenage labor. The U.S. Department of Labor reported that teenage unemployment is an increasing problem. Which graph in Figure 4-10 is consistent with these facts?
a.
1
b.
2
c.
3
d.
4
Figure 4-10
You accidentally run into your next door neighbor's fence and destroy it. Your neighbor sues you and you are required to pay $1,000 to repair the fence. This is an example of
A. the Coase theorem. B. a liability rule. C. the free-rider problem. D. an injunction.
Refer to Figure 34.1. Suppose the production possibilities curve PP2 represents the U.S. economy and point C represents the combination of goods and services currently being produced. If welfare discourages people from seeking work and welfare is currently in effect, the most likely result of eliminating welfare in the United States would be
A. A shift from PP2 to PP3. B. No change from PP2 or point C. C. A movement from point C to a point on PP2. D. A shift from PP2 to PP1.
U.S. currency ________
A) is less efficient than barter B) includes tobacco C) is the sum of M1 and M2 D) is composed of the bills and coins held by individual and businesses