Studies show that as real income has been rising in the United States, the per-capita demand for food has been increasing by
A) much less, which means the demand for food is income inelastic.
B) much more, which means the demand for food is income elastic.
C) much more, which means the demand for food is income inelastic.
D) as much, which means the demand for food is unit elastic.
E) none of the above
A
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Consider the following statements:
a. Soda drinkers purchase more soda from a grocery store that sells soda at a lower price than other rival grocery stores in the area. b. Homeowners do not take steps to increase security even though they believe it is more costly to allow burglaries than to install security monitoring equipment. c. Manufacturers produce less of a particular cell phone when its selling price rises. Which of the above statements demonstrates that economic agents respond to incentives? A) a only. B) b only. C) c only. D) a and b. E) a, b, and c.
If public goods can be produced more efficiently, then
A) public goods increase, and private goods may increase or decrease. B) public goods production stays the same, and private goods increase. C) public goods and private goods both increase. D) public goods production falls, and private goods production rises.