For a good such as food, the income elasticity is likely
A) negative.
B) equal to zero.
C) positive and less than one.
D) positive and greater than one.
E) undefined because people always buy the same amount of food.
C
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One rationale for government involvement in health care markets is that government involvement is necessary to prevent the spread of contagious diseases, which can be a type of externality
Which of the following is not an example of a public health externality? a. The provision of vaccinations against communicable diseases. b. The provision of clean drinking water to prevent the spread of water-borne diseases. c. The elimination of pools of standing water to help prevent the spread of malaria. d. The provision of drugs to help control cholesterol, a primary factor in heart disease.
Chicken and fish are substitutes. Therefore, the cross elasticity of demand between chicken and fish should be: a. negative
b. positive. c. zero. d. All of the above are possible.