Suppose studies showed that 12 percent of all teens choose to participate in underage drinking. If policymakers wish to reduce the amount of underage drinking, they should:
A. not share that statistic, and let teens think that it's a huge problem with all teens.
B. Informing them will have no impact on their individual behavior.
C. let teens know that the great majority of teens currently do not drink.
D. The statistic is likely to influence their personal decision, but it is impossible to predict in what way without more information.
C. let teens know that the great majority of teens currently do not drink.
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In the above figure, income is $8, the price of a soft drink is $1, and the initial price of a milkshake is $2. If the price of a milkshake decreases to $1, milkshakes are revealed to be
A) an inferior good. B) a normal good. C) less preferred than soft drinks. D) None of the above answers is correct.
If capital demand shifts to shorter lived equipment, then
A) net investment will fall. B) net investment will increase. C) net investment will not change. D) the effect on net investment is unknown.
Which of the following statements is true with respect to renewable natural resources?
a. There are infinite quantities of renewable resources. b. Proper management can only protect, not increase, the supply. c. Conservation and proper use can protect and even increase the supply of renewable resources. d. They cannot be completely destroyed since they can always regenerate. e. They cannot exist since this would violate the scarcity principle.
Assume that the expectation of declining housing prices cause households to reduce their demand for new houses and the financing that accompanies it. If the nation has low mobility international capital markets and a flexible exchange rate system, what happens to the quantity of real loanable funds per time period and the nominal value of the domestic currency in the context of the
Three-Sector-Model? a. Real GDP falls, and nominal value of the domestic currency rises. b. Real GDP falls, and nominal value of the domestic currency remains the same. c. Real GDP rises, and nominal value of the domestic currency rises. d. Real GDP falls, and nominal value of the domestic currency falls. e. There is not enough information to determine what happens to these two macroeconomic variables.