Classical economists believed that:
a. price flexibility automatically directs market economies to full employment.
b. budget deficits and surpluses were necessary for the control of economic fluctuations.
c. market economies suffer prolonged periods of recessions and depressions.
d. market economies are inherently unstable because of fluctuating aggregate demand.
a
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Two-part pricing allows the monopoly firm to capture all of the potential consumer surplus generated by the sale of its product
Indicate whether the statement is true or false
In a prison, cigarettes are used as a medium of exchange. In this scenario, a cigarette is an example of: a. near money
b. fiat money. c. fiduciary money. d. commodity money.
When natural resources are not traded, or where markets are not allowed to function as well as they can under a system of well-defined property rights, the problems of ____ and ____ are common
a. higher taxes; increased regulation b. waste; scarcity c. inflation; unemployment d. slow growth; fluctuating currency values
Ceteris paribus, when used by economists, means
A. all other things equal. B. for every action, there is a reaction. C. things never change. D. buyer beware.