Which of the following checks issued by the government represents a transfer payment?
A. The state of Oregon pays a construction firm for its work in repairing a state highway.
B. The state of Illinois pays groundskeepers at the state capitol building their weekly wages.
C. The federal government pays a retiree her Social Security benefits.
D. The federal government pays a defense contractor for development of a missile system.
Answer: C
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Refer to above Table 2-1. What is the total amount of leakages?
A) 530 B) 1080 C) 970 D) 550
Which of the statements below does not describe a demand curve that is unit elastic?
a. The percentage change in the quantity demanded = percentage change in product price. b. An increase in product price will not change total revenue. c. The price elasticity of demand equals one. d. A change in price does not change quantity demanded. e. A decrease in product price will not change total revenue.