Economics can decide
A. the appropriate trade-off between fairness and efficiency.
B. which pricing arrangements are fair and which are unfair.
C. whether a pricing decision will impose heavy inefficiency costs on society.
D. All of the responses are correct.
Answer: C
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By the permanent-income hypothesis, the MPC of transitory income is
A) k. B) j. C) kj. D) k - j. E) 0.
The more elastic the demand for the good labor produces, the less elastic the demand for labor.
Answer the following statement true (T) or false (F)
The rule of 72 implies that a country will double its income in about 4 years if its growth rate is:
A. 25 percent. B. 18 percent. C. 8 percent. D. 12 percent.
If a natural disaster were to cause a negative long-run supply shock to the economy, once the economy adjusts, the new equilibrium will be at a:
A. higher price level and lower level of output. B. lower price level and lower level of output. C. higher price level and higher level of output. D. lower price level and higher level of output.