How is a family budget an exercise in managing scarcity? What role does income play?
Answer: A family budget is a plan for managing income and spending. Families have wants that surpass the resources necessary to satisfy them all. This causes decision making and the choices involve opportunity costs. Income is the amount of money the family has available to spend. That is, it constrains spending.
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Figure36-9
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In Figure 36-9, the C + I + G + (X? IM)1 line is flatter than the C + I + G + (X? IM)0 line because the
A. (X? IM)1 line indicates that net exports decline as GDP rises. B. (X? IM)1 line indicates that net exports rise as GDP rises. C. multiplier is greater for the (X? IM)1 line. D. (X? IM)1 line indicates that tariffs, quotas, and other trade barriers are keeping net exports below their full potential.
According to the Coase Theorem, individuals can always work out a mutually beneficial agreement to solve the problems of externalities even when high transaction costs are involved
a. True b. False Indicate whether the statement is true or false
Answer the following statement true (T) or false (F)
1) Products and services are scarce because resources are scarce. 2) An economy cannot produce at a point outside of its production possibilities curve because human economic wants are insatiable. 3) An economy cannot produce at a point outside of its production possibilities curve because human economic wants are insatiable. 4) The present choice of position on the production possibilities curve will not influence the future location of the curve.
Which of the following is a financial intermediary?
A. the Internal Revenue Service B. the U.S. Department of the Treasury C. an insurance company D. a share of corporate stock