What determines the income flows that households receive?
A) an agency of the Federal government
B) what they choose to produce, how much is sold, and the price received when sold
C) their ownership of factors of production, how much they sell in the factor markets, and the prices received when sold
D) financial institutions such as banks
E) what they choose to consume
C
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By selling products in both retail stores and outlet stores, firms can increase their profits by charging ________ prices to consumers with a low price elasticity of demand and ________ prices to consumers with a higher price elasticity of demand
A) higher; lower B) lower; lower C) higher; higher D) lower; higher
Dividing fiscal policy into two instruments has the effect of introducing another policy target:
A) the interest rate. B) the national debt. C) the unemployment rate. D) the division of output between public and private spending.