Large or persistent inflation is almost always caused by
a. excessive government spending.
b. excessive growth in the quantity of money.
c. foreign competition.
d. higher-than-normal levels of productivity.
b
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Which of the following correctly identifies an argument against free trade?
A) Free trade reduces world production. B) Free trade hampers technology transfers. C) Free trade increases the wages in importing countries. D) Free trade may result in job loss in some specific industries in the domestic economy.
Suppose a government sets theprice for a natural monopoly at the competitive level such that P = MC. To keep the seller from taking a loss under this policy, the government could provide a lump-sum payment to the firm
How could we determine this payment? A) Multiply the competitive quantity by the competitive marginal cost B) Multiply the competitive quantity by the regulated price C) Multiply the competitive quantity by the difference between MC and AC D) Multiply the difference in the competitive and monopoly quantities by AC
The potential rewards that are available to an individual if a particular activity is undertaken are known as
A) premiums. B) gifts. C) incentives. D) intrinsic values.
Which of the following can serve as an entry barrier?
A. Legal restrictions B. Patents C. Control of scarce resources or inputs D. All of these responses are correct.