Government transfer payments
a. are subtracted from national income to obtain disposable income.
b. can be considered as negative taxes.
c. intervene between national product and disposable income in the same way as taxes.
d. are counted the same as taxes in computing national income.
b
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Suppose a consumer is currently spending all of her available income on two goods: music CDs and DVDs. If the price of a CD is $9, the price of a DVD is $18, and she is currently consuming 10 CDs and 5 DVDs, what is the consumer's income?
a. $90 b. $180 c. $270 d. $360
Structural problems associated with globalization are no longer a concern for policy makers or economists.
Answer the following statement true (T) or false (F)
The third step of the four step process is to
a. identify the new equilibrium and then compare the original equilibrium price and quantity to the new equilibrium price and quantity. b. decide whether the economic change being analyzed affects demand or supply. c. draw a demand and supply model before the economic change took place. d. decide whether the effect on demand or supply causes the curve to shift to the right or to the left, and sketch the new demand or supply curve on the diagram.
If Sam, the Pizza Man, lowers the price of his pizzas from $6 to $5 and finds that sales increase from 400 to 600 pizzas per week, then the demand for Sam's pizzas in this range is:
A. inelastic. B. elastic. C. unit elastic. D. inferior.