The demand by sterile couples for babies to adopt has grown rapidly, while the supply has dwindled because of improved contraception, liberal abortion laws, and an increase in the probability that unwed mothers will keep their children. It violates the law to sell human beings at any age, but for every 20 legal adoptions, there seemingly is one baby sale at a price up to $50,000. The generic term economists apply to the market produced by this type of shortage is
A. “black market.”
B. “white slave market.”
C. “the adoption market.”
D. “baby market.”
Answer: A
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a. to estimate from estimated to actual values b. to translate from real to nominal values c. to translate from nominal to real values d. as a policy target e. c and d
The demand curve for a good is a line that relates
a. price and quantity demanded. b. income and quantity demanded. c. quantity demanded and quantity supplied. d. price and income.
A landscaper purchases a lawnmower, a rake, a truckload of gravel, and a chainsaw. Which of these four goods would most likely be considered as a commodity?
(A) A rake (B) A truckload of gravel (C) A chainsaw (D) A lawnmower
You use $45,000 of your own money to start an espresso stand. During the first year you earn a 10% return on that investment. If the current interest rate is 8%, you earn an economic profit of
A. -$900. B. $100. C. $500. D. $900.