Government vouchers to purchase food, also known as food stamps, are an example of
a. an in-kind transfer.
b. life-cycle income.
c. a negative income tax.
d. permanent income.
a
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The purchase of VCU2 by Tomas Tiergarten, a private resident, causes the nation's:
a. Monetary base to rise. b. M2 money supply to rise. c. M2 money supply to remain the same. d. M2 money supply to rise.
Which of the following is not an example of moral hazard?
A. Investment banks use 40-1 leverage, knowing that if the market collapses, the government will come to the rescue. B. A backcountry skier takes an excessively dangerous run, knowing that local rescue crews will come to his aid if he gets in an accident. C. Insurance companies stopped offering insurance policies in New Orleans after a major hurricane, knowing the government will offer subsidies to draw people back. D. Domestic automobile companies fail to design high-quality fuel-efficient cars, hoping that the government will save them if oil prices skyrocket.
In the short run, the ATC curve is _____ above the AVC curve.
A. always B. sometimes C. never
Refer to Excise Subsidy. After the subsidy is granted, producers' surplus equals
The following questions refer to the accompanying diagram which shows the effects of an excise subsidy given to firms. The initial price and quantity are P0 and Q0, respectively. After the subsidy is granted, the equilibrium quantity is Q1, firms receive the price Ps, and consumers pay the price Pd.
a. area A + B + E + H.
b. area E + H + F + I.
c. area B + C + E + H.
d. area H.