Richard receives government transfer payments and currently consumes five guns and six goose livers. Assume the price of guns decreases by 10% and the price of goose liver increases by 20%
The government raises Richard's transfer payments so he can still afford five guns and six goose livers. Does this constitute a true cost-of-living adjustment? A) No. Richard is overcompensated.
B) No. Richard is undercompensated.
C) Yes. The payment just achieves the right level of compensation.
D) Not enough information.
A
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a. electricians' wage rates b. monopolistic pricing c. price of automobiles d. general price level
Direct controls
A. have not been tried in practice, but work in theory. B. have been the main instrument used by the United States when dealing with polluting activities. C. achieve more success than pollution charges. D. achieve more success than pollution allowances.
Oligopoly is characterized by:
A. few sellers. B. no barriers to entry. C. inability to set price. D. low market concentration.
A person that is risk averse
A) exhibits decreasing marginal utility of wealth. B) exhibits increasing marginal utility of wealth. C) always engages in fair bets. D) loves lotteries.