According to the Pew Charitable Trust methodology for identifying the middle class, if people near the boundary between the lowest and the lower middle income class lose income, the middle class will ________
A. increase, and that is unambiguously a good thing.
B. shrink, but that is unambiguously a good thing.
C. shrink, and that is unambiguously a bad thing.
D. increase, and that is unambiguously a bad thing.
Answer: C
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If the Federal Reserve conducts an open market sale, the
A) interest rate will decrease. B) interest rate will increase. C) interest rate will not change. D) money supply is increased.
Indifference curves typically a. cross each other
b. have a positive slope. c. are convex from the origin. d. are concave from the origin.
Signaling is important because: a. it increases social benefits associated with public goods
b. it decreases external costs associated with externalities. c. it reduces information costs associated with asymmetric information. d. all of the above
The interest rate changes made by the Fed in 2005–2006 contributed to housing prices ______.
a. falling b. rising c. stabilizing d. doubling