Suppose a quota on foreign-made automobiles is proposed in Congress. Which of the following groups is most likely to oppose the bill?
a. American Automobiles Manufacturers. b. Consumers.
c. American Steel Workers. d. United Auto Workers.
QUESTION 2At the point where the disposable income line intersects the consumption function, saving:
a. equals consumption.
b. equals disposable income.
c. is less than zero.
d. is equal to zero.
QUESTION 3A restriction on the quantity of a good that can be imported into a country is a(n):
a. tariff. b. quota.
c. embargo. d. restricted exchange rate.
QUESTION 4A special interest group cannot impose its will on the majority because the perceived costs and benefits from government programs are the same for both groups.
a. True
b. False
Indicate whether the statement is true or false
QUESTION 5Which one of the following changes is consistent with a change in an economy's consumption function from C = 500 billion + 0.80Y to C = 700 billion + 0.80Y?
a. An increase in disposable income taxes.
b. An increase in interest rates
c. A decrease in permanent disposable income.
d. An increase in wealth.
e. An increase in savings.
QUESTION 6Cost-benefit analysis can be applied to individual decision-making and public choice theory.
a. True
b. False
Indicate whether the statement is true or false
QUESTION 7Imposing a restrictive quota on imported plasma TVs will:
a. increase the price of the plasma TVs and decrease the quantity consumed.
b. increase both the price of the plasma TVs and the quantity consumed.
c. leave the price of the plasma TVs unchanged but decrease the quantity consumed.
d. leave the price and the quantity consumed of plasma TVs unchanged, because domestic producers will expand production to make up for the reduction in imports
QUESTION 8Given the consumption function C = 500 billion + 0.80Y, an increase in disposable income from 6,000 billion to 7,000 billion will cause consumption to increase by:
a. 800 billion.
b. 1,000 billion.
c. 1,300 billion.
d. 1,500 billion.
e. 1,800 billion.