The percentage of the population in the two higher income classes (defined by Pew as having more than 200% of median family income) declined from more than 60% in the 1970s to 50% in 2015. Economists that see the decline in the middle class as a cause of declining growth argue
A. the middle class is responsible for most of the investment dollars available.
B. that middle-class is generated by growth and without it, there are fewer middle-class jobs.
C. the middle class is responsible for buying a high portion of the goods and services produced.
D. if the poor can't afford goods, less will be produced.
Answer: C
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Which of the following would NOT affect a good's price elasticity of demand?
A) the ease of substitution between goods B) the cost of producing the good C) the number of substitute goods available D) the proportion of one's budget spent on an item
If a person has a comparative advantage in some activity, she must have an absolute advantage in that activity as well.
Answer the following statement true (T) or false (F)
The cross price elasticity for coffee for a change in the price of tea is likely to be
A. negative but less negative than -1. B. zero. C. positive. D. negative and more negative than -1.
One would expect the price of a share of stock to fall if
A. expected dividends paid on the stock rise. B. the risk of the business falls. C. the interest rate rises. D. the economy expands.