A decrease in taxes would cause:
A. the dynamic aggregate demand curve to shift to the right.
B. the dynamic aggregate demand curve to shift to the left.
C. a movement up and along the existing dynamic aggregate demand curve.
D. a movement down and along the existing dynamic aggregate demand curve.
Answer: A
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Professional baseball teams in the United States use only wooden bats. If aluminum bats were permitted, the likely result would be a
A. shift in the supply curve for aluminum bats. B. shift in the supply curve for wooden bats. C. change in the quantity supplied of aluminum bats. D. persistent shortage of aluminum bats.
To an economist, risky options:
A) are always bad options. B) are always good options. C) have costs and benefits fixed in advance. D) do not have costs and benefits fixed in advance.
Legislators argue that a minimum wage law is instituted to help poor people. Economists can attack the minimum wage law on two fronts. First, some argue that government should not help the poor
Second, some argue that minimum wage laws actually hurt the poor because it creates unemployment. Which argument is normative and which is positive?
Melita heard that there had been inflation last month. She laughed and did not believe it. When asked why not, she said that last week she spend less at the grocery store because the cost of food had come down. Which of the following is the correct response?
A. Melita is right, all prices must be rising for there to be inflation. B. Melita is right, if food prices are lower, so are all other prices. C. Melita is wrong, food prices are not used to calculate the rate of inflation. D. Melita is wrong, food prices may have fallen, but other prices have risen so the average price of goods is higher.