Why does an economy need a rationing mechanism?
A) because of scarcity
B) because it preserves the power of the wealthy
C) because it eliminates poverty
D) All of the above are correct.
Answer: A
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Assume that a particular state has decided to outlaw the sharing of individuals' credit histories as an illegal invasion of privacy. As a result of this action we would expect the
A) cost of borrowing money to rise. B) number of loans to unworthy credit risks to rise. C) problems of asymmetric information to become more severe. D) all of the above E) none of the above
A primary emphasis of the Keynesian school is the economy:
a. has a tendency to always create a full-employment level of output. b. has a tendency to always create inflationary pressure at all levels of output. c. has a tendency to eliminate unemployment by lowering wage rates to create an equilibrium in the labor market. d. is driven by the supply-side of the market. e. has a tendency to be in equilibrium at less than full employment.
Which of the following is an argument made in support of tariffs and import quotas?
a. protecting infant industries b. promoting national defense c. preventing product dumping d. all of the above
A society is saving lives (productively) efficiently if
a. there are no unemployed resources in the health care sector b. there are no unemployed resources anywhere in the economy c. there is no way to save more lives d. there is no way to save more lives without sacrificing some other goods or services e. the opportunity cost of saving one more life is zero