What does a household's budget line show?
What will be an ideal response?
The budget line plots combinations of goods that require all a household's income and describes the limits to its consumption choices.
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Which of the following statements would MOST accurately describe government spending between 1970 and 2006?
a. State and local governments spend more on goods and services than the federal government, but the federal government spends more in total than state and local governments. b. As a percentage of GDP, federal government spending on goods and services increased rapidly and by 2006, the federal government spending on goods and services was about twice as high as state spending on goods and services. c. As a percentage of GDP, federal government spending has been significantly reduced, which as forced state and local government total spending to increase dramatically to accommodate these cuts. d. As a percentage of GDP, both federal and state and local government total spending have doubled.
More farmers have recently entered the corn industry. In addition there has been a technological advancement in the fertilizer industry providing corn farmers with a cheaper and a more effective fertilizer. In the market for corn, the effects these
changes will have on the equilibrium price and quantity are A) price will increase, and quantity will decrease. B) price will increase, and the effect on quantity is indeterminate. C) price will decrease, and quantity will increase. D) price will decrease, and the effect on quantity is indeterminate.