One key assumption of the theory of public choice is that individuals
A. are always in favor of the collective well-being of the public instead their own well-being.
B. act differently between the public sector and the market sector.
C. act within the political process to maximize their individual well-being.
D. are always concerned about the well-being of other individuals in society.
Answer: C
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When the price of an inferior good falls, the substitution effect leads to ________ in the quantity purchased and the income effect leads to ________ in the quantity purchased
A) an increase; an increase B) an increase; a decrease C) a decrease; an increase D) a decrease; a decrease
If two variables B and V are positively correlated, B ________ when V ________
A) goes up; goes down B) goes up; goes up C) goes down; goes up D) remains unchanged; goes up
Which of the following statements is true?
A) The expected return and standard deviation of return are greater for common stock than for U.S. Treasury bills. B) The expected return on common stocks is greater than the expected return on U.S Treasury bills, but the standard deviation of return for common stocks is less than the standard deviation of return for U.S. Treasury bills C) The expected return on common stocks is less than the expected return on U.S Treasury bills, but the standard deviation of return for common stocks is greater than the standard deviation of return for U.S. Treasury bills. D) The expected return and standard deviation of return are less for common stocks than for U.S. Treasury bills.
When taxes are decreased, disposable income increases even though GDP is unchanged
a. True b. False Indicate whether the statement is true or false