Which of the following is not one of the basic economic questions that all economies must answer?
What will be an ideal response?
Which government agency will set the prices of the goods produced?
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In general, horizontal mergers will
A) increase the number of firms in an industry. B) decrease the number of firms in an industry. C) increase competition in an industry. D) reduce economic profits in an industry.
Policy should create an environment in which the economy can expand its productive capacity rapidly, because that is the ultimate source of higher living standards. This task is the realm of
a. growth policy. b. stabilization policy. c. labor policy. d. inflation policy.
Interest rates rising and falling by a wide range on a regular basis often are an indication of
A. seasonal unemployment. B. economic instability. C. flexible capital. D. price equilibrium.
If a public corporation goes bankrupt and does not have enough assets to pay off all creditors:
A. the fact that stockholders are residual claimants means they may have to pay in additional capital to cover the obligations. B. the stockholders receive any dividends due before the other creditors are paid C. the stockholders cannot lose more than their investment. D. the stockholders are personally liable for the balance.