The basic economic argument for the market system is that it promotes:
A. the use of money.
B. equality in the distribution of income.
C. personal freedom.
D. an efficient allocation of resources.
Answer: D
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Use the following graph to answer the next question.
If the equilibrium interest rate is 4%, the supply of money must be
A. $100 billion. B. $150 billion. C. $200 billion. D. $250 billion.
Analyze the effects of an increase in the European money supply on the dollar/euro exchange rate
What will be an ideal response?
The Rand Corporation estimates that external costs imposed by alcohol consumption (e.g., deaths caused by drunk drivers) to be 48 cents per ounce consumed. If taxes on alcohol are 23 cents per ounce consumed, then
A. marginal social benefit is greater than marginal social cost. B. the alcohol taxes are increasing economic inefficiency and dead-weight loss. C. alcohol consumption is greater than socially optimal. D. marginal external costs plus marginal private costs are less than price.
Like the human body, an economy is made up of many small, specialized, interactive parts; like blood circulates in a human body, money circulates through an economy, providing necessary resources for both households and firms
Indicate whether the statement is true or false