Points that lie below the production possibilities curve are inefficient because:
A. too many goods are being produced.
B. producers face scarcity.
C. producing more of one good means producing less of the other.
D. more of one good could be produced without producing less of the other.
Answer: D
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If insurers charge everyone the same premium based on the average cost of insuring the entire group, _____
a. the poor will drop out because the premiums are too high b. the middle class individuals will drop out because they can self-insure c. the healthiest individuals in the market will drop out d. the sickest individuals in the market will drop out
Which of the following correctly describes the mechanics of the spending multiplier? a. An initial increase in aggregate expenditures, such as an increase in government spending, shifts the aggregate expenditures curve upward vertically. b. After the expenditures curve shifts upwards, the economy is not in equilibrium because aggregate expenditures now exceed aggregate output, leading to
inventory depletion. c. Real GDP increases in response to inventory depletion, eventually leading to a new higher level equilibrium real GDP. d. All of the above answers are correct.
If the MU/P for video rentals is 5 and the MU/P for movie theaters is 8, this person should go to movie theaters more often and rent fewer videos
Indicate whether the statement is true or false
Minimum-wage laws are precise policy instruments that can specifically target workers whose family incomes are low
a. True b. False Indicate whether the statement is true or false