The table shows the distribution of human and non-human capital for two people, Sam and Janet
a) Looking just at tangible assets (non-human capital), by how many times does Janet's wealth exceed Sam's?
b) Assume that both human and non-human capital earn a 10 percent annual interest rate. Calculate Sam's and Janet's total income.
c) By how many times does Janet's total income exceed Sam's?
d) Which comparison results in a more equal distribution?
e) Which comparison gives a better indication of each person's economic condition?
a) Janet has 20 times as much wealth as Sam.
b) Sam's income is $30,000 and Janet's is $41,000.
c) Janet's income is 1.37 times Sam's.
d) The comparison of income results in a more equal distribution.
e) The comparison of income gives a better indication of each person's economic condition because it includes both human and non-human capital, while the comparison of wealth only includes non-human capital.
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Which of the following is true about the Federal Reserve and its ability to prevent recessions? The Federal Reserve
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Total expenditure by a buyer is equal to the
a. slope at any point along the demand curve. b. price times quantity demanded at any point along the demand curve. c. elasticity times price at any point along the demand curve. d. elasticity times quantity demanded at any point along the demand curve.
Suppose that consumption spending is $3,200 billion, spending on durable goods is $800 billion, and spending on services is $1,800 billion. What does spending on nondurable goods equal?
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