Suppose that the marginal benefit per dollar spent on pop tarts exceeds the marginal benefit per dollar spent on waffles. The consumer can always increase their utility by buying:
A. more pop tarts and fewer waffles.
B. fewer pop tarts and more waffles.
C. more of both goods.
D. The consumer cannot increase her utility.
Answer: A
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The self-correcting property of the economy means that output gaps are eventually eliminated by:
A. increasing or decreasing potential output. B. government policy. C. decreasing inflation only. D. increasing or decreasing inflation.
A surplus occurs when the quantity of a good supplied at the existing price is greater than the quantity demanded
Indicate whether the statement is true or false
Marginal revenue is defined as
A. the change in total revenue from a unit change in price. B. the change in average revenue from a one-unit change in output. C. the change in total revenue from a one-unit change in output. D. the change total cost from a one-unit change in output.
A transfer payment is a sum of money
a. spent by government for new goods and services. b. shifted between members of a household. c. given by government without a good or service in exchange. d. moved between companies for goods and services. e. required to pay taxes.