Do food stamps affect the slope of the budget constraint of their recipients or rather shift the budget constraint? Explain
What will be an ideal response?
The poor still face the same price for food. Therefore, their budget constraint has not changed slope but has merely shifted.
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In a small Asian country, it is estimated that changing the level of capital from $8 million to $12 million will increase real GDP from $4 million to $6 million
What level of GDP would you expect the economy to be able to reach if spending on capital continued to rise to $16 million, assuming no technological change and no change in the hours of work? A) GDP would increase further by exactly $8 million. B) GDP would increase further by exactly $2 million. C) GDP would increase further, but by less than $2 million. D) GDP would increase further by more than $2 million
After the price of milk increases, David buys more eggs and less cereal. For David
A) milk, eggs, and cereal are all complements. B) milk and eggs are complements, and milk and cereal are substitutes. C) milk and eggs are substitutes, and milk and cereal are complements. D) milk, eggs, and cereal are all substitutes.
According to the graph shown, if this economy were to open to trade, the amount consumed domestically would:
This graph demonstrates the domestic demand and supply for a good, as well as the world price for that good.
A. increase by 35.
B. increase by 40.
C. decrease by 40.
D. increase by 75.
Human capital differs from physical capital in that
a. human capital is intangible. b. human capital is tangible. c. physical capital is intangible. d. human capital has no cost to acquire.