Critics of the U.S. definition of poverty claim it is an inaccurate measure of our poor because:
A. it is a single number that does not capture regional differences in the cost of living.
B. it fails to account accurately for expenditures other than food.
C. the ratio of food to total income is different now than when the definition of poverty was defined.
D. All of these are true.
Answer: D
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When economists use the term "big tradeoff" when discussing efficiency they are referring to the tradeoff between
A) external costs and external benefits. B) marginal cost and marginal benefits. C) producer surplus and consumer surplus. D) efficiency and fairness. E) deadweight loss and producer/consumer surplus.
When banks hold excess reserves the:
A. money multiplier underestimates how much money will be created in the economy. B. money multiplier overestimates how much money will be created in the economy. C. reserve ratio is not fully functioning, and should be lowered. D. reserve ratio is not fully functioning, and should be raised.