Because the value of non-cash benefits to the poor is not counted when calculating the official poverty rate in the U.S., the official statistics
A. underestimate the poverty rate.
B. overstate the real income of the poor.
C. accurately measure the poverty rate.
D. overestimate the poverty rate.
D. overestimate the poverty rate.
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According to some New Keynesian theories, one possible rationale for active policy making is
A) growing competition in U.S. product markets. B) flexible prices. C) sluggish adjustment of the price level in response to changes in aggregate demand D) people are not rational and so do not react to incentives.
As Sally increases her consumption of a good, she experiences diminishing marginal utility if her total utility
A) increases at a constant rate. B) increases at a decreasing rate. C) increases at an increasing rate. D) decreases.
The classical model indicates that at the equilibrium interest rate, saving is
A) equal to investment. B) greater than investment. C) unnecessary for investment. D) less than investment.
The hot spot problem is:
a. the U.S. obtains the majority of its oil supplies from politically unfriendly countries. b. some air pollutants such as sulfur dioxide have a greater effect nearby than further away. c. some air pollutants such as carbon dioxide have an equal effect nearby and further away. d. nuclear plants heat up nearby water, causing a decline in the native fish population.