Freely functioning markets in the real world always result in efficient allocations of resources.
Answer the following statement true (T) or false (F)
False
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A nonbinding price floor (i) causes a surplus. (ii) causes a shortage. (iii) is set at a price above the equilibrium price. (iv) is set at a price below the equilibrium price
a. (iii) only b. (iv) only c. (i) and (iii) only d. (ii) and (iv) only
The market mechanism:
A. Works through central planning by the government. B. Eliminates market failures created by the government. C. Uses prices as a means of communication between consumers and producers. D. Is very inefficient since consumers cannot communicate directly with producers.
If wealth rises,
A. The AD curve will shift to the left. B. There will be a movement to the left along the AD curve. C. There will be a movement to the right along the AD curve. D. The AD curve will shift to the right.
In recent times, the price of oil has risen dramatically. Economic analysts currently are focusing on questions concerning the likely impacts of this price increase on the U.S. economy. The branch of economics that deals with this situation (i.e., what
will be questions) is called ________ economics. Fill in the blank(s) with correct word