The amount of consumption in an economy correlates:
A. Inversely with the level of disposable income
B. Directly with the level of disposable income
C. Directly with the level of saving
D. Directly with the rate of interest
B. Directly with the level of disposable income
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Which of the following statements is correct about a market in which pollution is emitted?
a. Both corrective taxes and pollution permits internalize the externality of pollution. b. Corrective taxes internalize the externality of pollution, but pollution permits do not internalize that externality. c. Corrective taxes fail to internalize the externality of pollution, but corrective taxes internalize that externality. d. Neither corrective taxes nor pollution permits internalize the externality of pollution.
Refer to the information provided in Figure 6.7 below to answer the question(s) that follow.
Figure 6.7Refer to Figure 6.7. Along budget constraint AB, the price of good X is $10 and the price of good Y is $12. If the price of X increases to $15, the budget constraint will
A. pivot in at point A. B. pivot out at point A. C. pivot in at point B. D. shift in parallel to AB.