The basic problem with the government setting an absolute poverty line is that it is
a. completely objective.
b. somewhat arbitrary.
c. unconstitutional.
d. based on average income.
b
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Suppose you came across the following headline in a story of a daily newspaper: "Automobile prices are so high right now that there must be a shortage. As a consequence not everyone who needs an automobile will be able to buy one
" Is this statement necessarily correct?
As financial intermediaries, how do commercial banks pay their expenses and earn profit?
a. Banks pay depositors a higher interest rate than they charge borrowers b. Banks pay depositors a lower interest rate than they charge borrowers. c. Banks earn interest from their deposits at the Federal Reserve. d. Banks invest funds from stockholders in the stock and bond markets.
Refer to the diagram for a nondiscriminating monopolist. The profit-seeking monopolist will:
A. always produce at output q 2 .
B. always produce more than q 2 .
C. never produce an output larger than q 2 .
D. never produce an output larger than q 1 .
Refer to the demand and supply diagram that relates to the health care market. If suppliers provide whatever quantity of health care is demanded, health care insurance causes:
A. resources to be underallocated to the health care industry.
B. resources to be overallocated to the health care industry.
C. health care to be underconsumed.
D. the price of health care to the insured to be higher than the market price.