When does the free-rider problem arise?
A) when someone who benefits from a good does not have to contribute to paying for it
B) when a firm does not have to advertise, because its customers recommend the product to their friends
C) when policymakers ignore opportunity costs in making decisions
D) when production of a good generates pollution
Answer: A
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A commercial bank like Comerica creates money by
A) making loans. B) selling corporate bonds. C) earning profits. D) printing paper money.
In 1770,all the Townshend duties were repealed except_____
a. the duty on tea b. the duty on glass c.the duty on paper d.the duty on red and white lead
The process of adding more capital per worker is called capital deepening
a. True b. False Indicate whether the statement is true or false
Which of the following is the definition of autonomous consumption spending?
a. The effect of a change in wealth on consumption spending b. The part of consumption spending that is independent of disposable income c. The impact of disposable income on consumption spending d. The part of consumption spending that is independent of wealth e. The horizontal intercept of the consumption function