Compared to a direct cash transfer payment of an identical amount, food stamps make individuals who desire less food than the value of the food stamps _____
a. better off
b. worse off
c. indifferent between food and all other goods
d. prefer food too all other goods on the margin
b
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A speculative bubble causes
a. current prices to sink artificially low. b. current prices to rise artificially high. c. no current price changes, only possible future changes. d. undervaluing of stock prices.
A government reduces its budget deficit, but at the same time people become concerned that the outlook for future government expenditures and revenues increase the chance it will default. Which of the following is correct?
a. The reduced budget deficit will raise interest rates in general. The increased risk of default will raise interest rates on government bonds. b. The reduced budget deficit will raise interest rates in general. The increased risk of default will reduce interest rates on government bonds. c. The reduced budget deficit will reduce interest rates in general. The increased risk of default will raise interest rates on government bonds. d. The reduced budget deficit will reduce interest rates in general. The increased risk of default will reduce interest rates on government bonds.
The most competitive industry among the following is one that has
A. price leadership. B. covert collusion. C. open collusion. D. a cartel.
The effects of the national health care program on goods and services markets will
A) increase the marginal cost of the firm. B) increase the quantity produced of the firm. C) consumers will pay lower prices for many goods and services. D) decrease the quantity demanded for all goods and services.