A mathematical formula for the deficit would be
A. C + I + G ? transfers + taxes.
B. C + I + G + transfers – taxes.
C. I + G + transfers – taxes.
D. G + transfers – taxes.
Answer: D
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Some people make purchases without complete information because:
A. they are irrational. B. the opportunity cost of getting more information outweighs the benefit of having more information. C. the benefit of having more information outweighs the opportunity cost of acquiring it. D. No one makes purchases without complete information.
If the government enacts contractionary fiscal policy, it could:
A. reduce its spending. B. decrease personal income taxes. C. decrease corporate income taxes. D. All of these are contractionary.
Given a consumer's indifference map, the demand curve for a good can
a. be derived by moving a consumer's budget constraint as her income falls. b. be derived by moving a consumer's budget constraint as her income rises. c. be derived by moving a consumer's budget constraint as the market price of one good changes. d. not be derived from consumer theory.
Suppose we observe a decrease in the equilibrium price of tuna and an increase in the equilibrium quantity of tuna. This is best explained by:
A. a decrease in the cost of fuel used by tuna fishing boats. B. a decrease in the expected future price of tuna. C. an increase in the price of salmon, a substitute for tuna. D. a decrease in the tuna population in the oceans.