The inauguration of a new President often increases the degree of optimism in business firms and households, causing Ap to
A) rise and IS to shift leftward.
B) fall and IS to shift leftward.
C) fall and IS to increase.
D) rise and IS to shift rightward.
D
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When the federal government gives a grant to a state or local government without restrictions on use, this is known as
A. revenue sharing. B. block grants. C. endowments. D. tax shelter.
Suppose two people start with an initial endowment and trade until they obtain a Pareto-efficient allocation with the corresponding price line
What happens when more people who have the same tastes and endowments as the original two traders are included in the Edgeworth box analysis? A) The price line does not change. B) The price line becomes flatter. C) The price line becomes steeper. D) The price line shifts up or down depending upon how many of each type of trader is included in the analysis.
Public goods have at least one of two characteristics. What are the two characteristics?
a. collective consumption; nonexcludability b. individual consumption; nonexcludability c. collective consumption; excludability d. individual consumption; excludability
Of the four major market structures, oligopoly is the worst at achieving economic efficiency
a. True b. False