What will make a change in supply cause a small change in price?
What will be an ideal response?
A small change in supply and highly elastic supply and demand
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How do car dealers help reduce adverse selection?
What will be an ideal response?
Comparative advantage indicates which specific terms of trade will arise, given two countries' production possibilities
a. True b. False Indicate whether the statement is true or false
People benefit by participating in the market because:
A.) Resources are no longer limited. B.) It facilitates specialization and increased consumption. C.) Buyers and sellers have the same goals. D.) Participants in the market do not have to make choices.
The government wishes to close a recessionary gap by increasing national income by $700 billion. The MPC = 0.8 . Two policies are offered. Policy A calls for $180 billion in increased government spending and $50 billion in increased taxes. Policy B calls for $200 billion in increased government spending and $100 billion in increased taxes. Which of the following will increase the national income
by the desired $700 billion? a. Both policies increase national income by $700 billion but Policy B offers a lower budget deficit. b. Both policies increase national income by $700 billion and create equal budget deficits. c. Neither policy increases national income by $700 billion. d. Only Policy A increases national income by $700 billion. e. Only Policy B increases national income by $700 billion.