Which of the following does NOT describe a compensating variation?
A. The amount of money that exactly compensates a consumer for a change in economic circumstances
B. The amount of money that produces an equivalent effect on a consumer's well-being
C. The most someone is willing to pay to experience something beneficial
D. The least someone is willing to receive to experience something harmful
B. The amount of money that produces an equivalent effect on a consumer's well-being
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The rise in unemployment in a country resulted in many unemployed people turning to criminal activity such as drug dealing, violent theft, and robbery as an alternative means to make money. It also led to growing political unrest. Therefore, unemployment in this country resulted in _____
a. a loss of lifetime earnings b. a loss of human capital c. the deterioration of health d. a loss of social cohesion
What variables besides real GDP tend to decline during recessions? Given the definition of real GDP, argue that declines in these variables are to be expected