When the quantity of money that people want to hold changes as a result of an increase in their income, they want the additional money mainly to serve as a
A. store of value.
B. standard of value.
C. medium of exchange.
D. means of deferred payment.
C. medium of exchange.
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One reason that economists encourage free trade is that
A) it encourages a more rapid spread of technology. B) it allows us to exploit the workers of less developed countries. C) we can sell more goods. D) it increases our capital stock.
Which of the following would NOT affect a good's price elasticity of demand?
A) the ease of substitution between goods B) the cost of producing the good C) the number of substitute goods available D) the proportion of one's budget spent on an item
An incentive is:
A. the marginal cost of engaging in a course of action. B. the marginal benefit of engaging in a course of action. C. something that causes people to behave in a certain way by changing trade-offs they face. D. rational behavior that involves thinking on the margin.
Other than OPEC, the shortage of gasoline in the U.S. in the 1970s could also be blamed on
a. a sharp increase in the demand for gasoline that was brought on by the Vietnam War. b. the government's policy of maintaining a price ceiling on gasoline. c. an indifference among U.S. consumers toward conservation. d. the lack of substitutes for crude oil.