A measure of overall prices at a particular point in time is called:
A. a real price.
B. inflation.
C. the price level.
D. a relative price.
Answer: C
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The problem created by asymmetric information before the transaction occurs is called ________, while the problem created after the transaction occurs is called ________
A) adverse selection; moral hazard B) moral hazard; adverse selection C) costly state verification; free-riding D) free-riding; costly state verification
It is against the law in the United States for one person to hold positions on more than one board of directors at a time
a. True b. False Indicate whether the statement is true or false
Explain how each of the following changes the money supply
a. the Fed buys bonds b. the Fed auctions credit c. the Fed raises the discount rate d. the Fed raises the reserve requirement
Ben says that "an increase in the tax on beer will raise its price." Holly argues that "taxes should be increased on beer because college students drink too much." We can conclude that:
A. Ben's statement is normative, but Holly's is positive. B. Holly's statement is normative, but Ben's is positive. C. Both statements are normative. D. Both statements are positive.