If the economy is in a boom, the response lag is generally shorter for monetary policy than for fiscal policy, but if the economy is in a slump, the response lag is generally shorter for fiscal policy than for monetary policy.
Answer the following statement true (T) or false (F)
False
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SouthState Chemical Co. produces pine oil cleaners in a process that produces emissions that discolor the paint on nearby houses, although the emissions have been declared nontoxic to humans. a. Is the price for the cleaner likely to be allocatively efficient? Use a graphic illustration in your answer. b. If your answer to (a) is no, what is an appropriate government policy to correct the problem?
What will be an ideal response?
PPP-adjustment:
A. gives us a realistic sense of how the living standards of the world's poorest citizens translate into dollar terms. B. allows us to see that poorer countries are not quite so poor as suggested by their nominal GDP per capita. C. gives us a more realistic sense of differences in living standards around the world. D. All of these statements are true.
In the long run an oligopoly:
A. may be able to earn positive economic profits. B. will produce on the portion of the demand curve where demand is price-inelastic. C. will always produce in the range of decreasing returns to scale. D. will always produce less than a monopoly.
The law of demand states that
A. the price can never be too high for some consumers. B. a higher price will lead to increased sales. C. consumers with more income will spend more on goods and services. D. quantity demanded of a good will vary inversely with the price of that good.