The crowding-out effect refers to
A) government spending crowding out private spending.
B) private saving crowding out government saving.
C) government investment crowding out private investment.
D) private investment crowding out government saving.
C
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If Ed Sike (who you met in Chapter 8 ) lowers ticket prices to a point where the number of tickets demanded is greater than the number of seats available,
A) Ed will be in a good position to grant favors to his friends. B) net revenue will be negative. C) net revenue will be positive but not necessarily at the maximum level. D) resources will not be allocated efficiently. E) total revenue will be maximized.
On a linear demand curve, the lower the price
A) the less elastic is demand. B) the more elastic is demand. C) the elasticity equals -1. D) the elasticity equals zero.