When external benefits exist, which of the following can produce the efficient amount of output?
I. vouchers
II. private subsidies
III. taxes
IV. marketable permits.
A) I and II only
B) I and III only
C) II and IV only
D) III and IV only
A
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A black market
A) is legal only when it is associated with government price ceilings. B) is defined as the deadweight loss associated with taxes. C) benefits no one. D) is a potential outcome of a price ceiling. E) is always legal.
Empirical evidence indicates that money demand is determined by
A) interest rates and the level of GDP. B) the inflation rate and the unemployment rate. C) interest rates and the money supply. D) the money supply and the level of GDP.
Monetarists argue that stability in the economy is maintained by fluctuations in
A) velocity. B) money demand. C) money supply. D) the price level.
Can the U.S. dollar and the euro both appreciate relative to each other? a. Yes, both countries can gain in this manner
b. Yes, provided the central banks agree to permit it. c. No, if one currency appreciates relative to another, the other depreciates. d. No, the citizens of the countries would not agree to it.