Which of the following would be considered an example of fiscal policy?
A. A reduction in income tax rates.
B. Interest rate hikes generated by a reduction in the money supply.
C. Provision of additional cash to the banking system.
D. A broad government initiative to reduce the country's reliance on agriculture and promote high-technology industries.
Answer: A
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A) a financial intermediary problem B) a principal-agent problem C) conquest and control D) a financial problem
Which of the following best explains why marginal cost eventually increases as output increases?
a. economies of scale occur b. average cost increases c. total cost increases d. marginal product decreases e. fixed cost is constant
A quota is a
a. tax imposed on each unit of an exported good b. tax imposed on each unit of an imported good c. change in the terms of trade between two nations d. result of opportunity cost differentials between two nations e. restriction on the quantity of a good that may be imported
Economists would describe cartels as
A. the opposite of ignoring interdependence. B. a collusive arrangement. C. an undesirable form of market organization that may charge a monopoly price. D. All of the responses are correct.