The marginal productivity theory of distribution holds that
a. each factor is paid what it deserves.
b. the owner of each factor is paid the amount that the factor contributes to earnings.
c. each factor's income depends on how hard it works.
d. each factor receives an equal share of the revenue from production.
b
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If market demand decreases and market supply increases, then equilibrium quantity will (be) ____ and equilibrium price will (be) ____
a. indeterminate; decrease b. indeterminate; increase c. decrease; indeterminate d. increase; indeterminate
To avoid a coordination failure, the intentions of savers and investors must be both
a. increasing. b. at their planned levels. c. more than full employment GDP. d. at levels set by the government.
Transactions accounts allow for direct payment to a third party.
Answer the following statement true (T) or false (F)
What is the inflation tax, and how might it explain the creation of inflation by a central bank?