What are Properties of Money?
1. Money must be relatively scarce
a. Counterfeiting makes money less scarce
2. Money must be portable and divisible
a. We need to be able to carry it around with us
b. We need to be able to divide it up into smaller units for purchases of various sizes
3. Money must be uniform
a. Every dollar, ounce of gold or purple pebble must be exactly the same, or not every unit will represent equal value.
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Which type of policy raises the most revenue for the government?
A) tariff B) quota C) voluntary export restraints D) If they are set at the same level, all of the above raise the same amount of revenue. E) None of the above answers is correct because none of the policies raises revenue for the government.
Suppose that the supply of insulin is perfectly elastic and the demand for insulin perfectly inelastic. Then the result of an excise tax would be
A. a significant increase in government revenue and a significant decrease in the quantity consumed. B. a significant decrease in the quantity consumed with no change in government revenue. C. a significant increase in government revenue and no change in the quantity consumed. D. no increase in government revenue and no change in the quantity consumed.
Economists call the physical cost of changing prices:
A. the cost of doing business. B. menu costs. C. inflationary suffrage. D. increasing profits.
The imposition of a tariff on a product is least likely to result in a(n):
A. Increase in the efficiency in the domestic industry producing the product B. Increase in the price of the product C. Decrease in the quantity of imports D. Decrease in the real incomes of workers in other industries