A Federal budget deficit exists when:
A. Federal government assets are less than liabilities in a given year
B. Federal government spending exceeds tax revenues in a given year
C. Federal government spending is increasing in a given year
D. Federal government taxation is decreasing in a given year
B. Federal government spending exceeds tax revenues in a given year
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In a centrally planned economy, resources are allocated primarily in accordance with directives from government agencies.
Answer the following statement true (T) or false (F)
Economic efficiency requires that a natural monopoly's price be
A) equal to average variable cost where it intersects the demand curve. B) equal to average total cost where it intersects the demand curve. C) equal to the lowest price the firm can charge and still make a normal profit. D) equal to marginal cost where it intersects the demand curve.
When Ford increases the production of cars in Romania, which of the following occurs?
A) GDP in the United States rises. B) GNP in the United States rises. C) GNP in Romania rises. D) Both A and C occur.
If governments promise to bail out the financial system in the event of a crisis, this creates a moral hazard problem. Describe this problem
What will be an ideal response?