Which of the following illustrates the economic inefficiencies of government regulation?
(a) Railroad rate increases are set by a government agency and these increases fall below increases in repair and depreciation costs but railroad passengers are satisfied.
(b) Competitive railroad rates are determined by the buying and selling actions of those in the railroad industry.
(c) Rate increases set by government agencies are set to match the increases in repair costs and the acceleration in depreciated capital.
(d) Government protects private and individual rights to goods, service and resources.
(a)
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Workers expect inflation to rise from 3% to 5% next year. As a result, this should
A) move the economy down along a stationary short-run aggregate supply curve. B) move the economy up along a stationary short-run aggregate supply curve. C) shift the short-run aggregate supply curve to the left. D) shift the short-run aggregate supply curve to the right.
Refer to Figure 18-2. If the government imposes an excise tax of $1.00 on every unit sold, the consumer's burden of the tax
A) is Pa - Pc under either supply curve. B) is Pa - Pd if the supply curve is S0 and Pb - Pe if the supply curve is S1. C) is Pa - Pc if the supply curve is S0 and Pb - Pc if the supply curve is S1. D) is Pb - Pc under either supply curve.
A central bank like the Federal Reserve in the United States can help banks survive a bank run by
A) raising the discount rate. B) acting as a lender of last resort. C) printing money. D) increasing the required reserve ratio.
If European economies experience strong economic growth, U.S. net exports will
a. increase and AD will shift rightward. b. increase and AD will shift leftward. c. decrease and AD will shift leftward. d. decrease and AD will shift rightward.