Which statement shows income as a factor affecting demand?
a. A factory in town gives its employees bonuses, and mall purchases increase.
b. Many people move into a suburb because it has affordable housing.
c. Advertising convinces people that jeans make them look overweight.
d. Meteorologists predict a winter with lots of snow, so shovel sales rise.
Answer: a. A factory in town gives its employees bonuses, and mall purchases increase.
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Suppose the price of an airline ticket from Dallas to Boston costs $600 . A bus ticket costs $150 . Traveling by plane takes 6 hours compared with 51 hours by bus. Other things constant, an individual would gain by choosing air travel if, and only if, his time were valued at more than
a. $6 per hour. b. $8 per hour. c. $10 per hour. d. $15 per hour.
Foreign residents can benefit from U.S. research and development activity because
A. they can import the goods, obtaining inputs at lower cost than they would otherwise. B. countries usually share patented ideas. C. they ignore U.S. patent laws and steal the technology. D. patents do a poor job of protecting the inventor.