All of the following were important structural changes in American capitalism during the period 1960–95 except
(a) New technology in the form of automated (machine-guided) production processes
(b) A capital-labor accord which allowed workers to share in productivity gains through wage increases, particularly during the 1950s and 1960s
(c) An increase in self-sufficiency as the nation reduced its economic interdependence with other nations
(d) A large and central role for government in directing the post-war economy
(c)
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Keynesian economists (as opposed to monetarist economists) argue that
A. the economy will quickly return to equilibrium via natural forces. B. the government should use macro policy to keep the economy from getting too far from full employment equilibrium. C. monetary policy should be used according to strict rules. D. Keynesian economists argue all of these statements.
Bank of Roseland has $700 million in deposits. The required reserve ratio is 15%. Bank of Roseland must keep ________ in reserves.
A. $55 million B. $85 million C. $105 million D. $140 million
Consider two types of rules that might govern an otherwise unregulated health insurance market: (1) Insurance companies can price-discriminate against the sick and old; (2) insurance companies cannot price discriminate against the sick and old. Explain why, in equilibrium, insurance may be very expensive for the sick and old regardless of which case we find ourselves in.
What will be an ideal response?
If the regulatory agency sets a price where AR = AC for a natural monopoly, output will be
A) equal to the competitive level. B) equal to the monopoly profit maximizing level. C) greater than the monopoly profit maximizing level and less than the competitive level. D) greater than the competitive level.