How do economists measure the consumption of a good?
(A) The amount of a good that is bought for a specific amount of money.
(B) The amount of money spent to buy a good.
(C) The amount of a good that is bought.
(D) The amount of a good that is actually used rather than bought.
Ans: (C) The amount of a good that is bought.
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If Don has budget constraint C in the graph shown, what is the trade-off he faces in terms of the two goods?
This graph shows three different budget constraints: A, B, and C.
A. Two cases of soda for every three gallons of milk
B. One case of soda for every one and a half gallons of milk
C. Three cases of soda for every four and a half gallons of milk
D. All of these accurately reflect Don's tradeoff.
Stephan prefers practicing his keyboard everyday instead of writing articles for the local newspaper, despite the fact that the newspaper will pay him $10 for every 100 words he writes. This implies that: a. his labor supply curve is a horizontal straight line. b. he has a high opportunity cost of leisure
c. his labor supply curve is negatively sloped. d. he places a high value on time spent in leisure.
If the government owes $15.0 trillion and then borrows $900 billion more this year, this leads to
a. a debt of $900 billion and a deficit of $15.9 trillion. b. a debt of $15.9 trillion and a deficit of $900 billion. c. a debt of $14.1 trillion and a deficit of $900 billion. d. a debt of $15.0 trillion and a deficit of $14.1 trillion. e. a debt of $15.9 trillion and a deficit of zero.
The opportunity cost of leisure will fall if
A. nonlabor income increases. B. the wage rate increases. C. the wage rate decreases. D. nonlabor income decreases.