Higher prices
A. are always against the public interest.
B. may sometimes serve the public interest.
C. should never be allowed.
D. occur automatically for abundant goods.
Answer: B
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A rent ceiling set below the equilibrium rent decreases the quantity of housing supplied because
A) landlords of previously barely profitable apartments refuse to rent them. B) the supply of housing increases. C) fewer tenants will search for housing. D) demand for housing will increase. E) the supply curve of housing immediately shifts leftward.
Assume that instead of having a federal income tax, the federal taxes are levied as a consumption tax based upon a flat rate of 10 percent of all that you consume
How would this tax be different from an income tax? Would you expect this tax to be progressive, proportional, or regressive? What do you think would happen to the amount that people save under such a tax scheme? Explain your answers.
After the price of smartphone apps falls, Justin buys fewer flash drives but he buys a new smartphone. For Justin
A) smartphone apps and flash drives are complements, and smartphone apps and smartphones are substitutes. B) smartphone apps, flash drives, and smartphones are all complements. C) smartphone apps and flash drives are substitutes, and smartphone apps and smartphones are complements. D) smartphone apps, flash drives, and smartphones are not all complements.
Which statement best describes a command economy?
a. The production of goods and services is determined primarily by markets, but the allocation of goods and services is determined primarily by government b. The production and allocation of goods and services is determined primarily through government c. The production and allocation of goods and services is determined primarily through markets d. The production of goods and services is determined primarily by government, but the allocation of goods and services is determined primarily by markets