A household's consumption choices cannot exceed limits created by
A) only the household's income.
B) only the prices of the goods and services that it buys.
C) both the household's income and the prices of the goods and services that it buys.
D) neither the household's income nor the prices of the goods and services that it buys.
C
You might also like to view...
If taxes are cut, there is
A) an increase in aggregate demand and the AD curve shifts rightward. B) a decrease in aggregate demand and the AD curve shifts leftward. C) an increase in the quantity of real GDP demanded and a movement up along the AD curve. D) a decrease in the quantity of real GDP demanded and a movement down along the AD curve. E) no change in aggregate demand, only a change in potential GDP.
Tommy's Teddy Bears incurs $300,000 per year in explicit costs and $50,000 in implicit costs. The shop earns $600,000 in revenues and has $1.1 million in net worth. Based on this information, what is accounting profit for Tommy's Teddy Bears?
A) $250,000 B) $300,000 C) $500,000 D) $1.35 million
The argument that econometric policy evaluation is likely to be misleading if policymakers assume stable economic relationships is known as
A) the monetarist revolution. B) the Lucas critique. C) public choice theory. D) new Keynesian theory.
Suppose the market for oranges is perfectly competitive and unregulated. Suppose also that the chemicals used to keep the oranges insect-free damage the environment by an estimated $1 per bushel of oranges. Suppose QD = 1000 - 100P and QS = -100 + 100P. If regulators limited production to 200 bushels, the deadweight loss relative to the option of setting the optimal tax would be would be
a. $0 b. $200 c. $500 d. $1000