Which of the following is not a cause of cost-push inflation?
A. labor cost increases.
B. energy cost increases.
C. raw material cost increases.
D. consumer incomes increase.
Answer: D
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When the price level increases, total planned real expenditures on goods and services falls. All of the following are responsible EXCEPT
A) the interest rate effect. B) the real-balance effect. C) the substitution effect. D) the open economy effect.
Kevin is a student who is yet to join a university in California. In the evening, he takes music lessons. Kevin has to decide on an apartment to rent
The apartment should be at a suitable distance from two places: his university, and from his music classes. The commuting time from apartments in four different locations to both destinations are shown in the table below. Given that Kevin's opportunity cost of time is $10 per hour, find his optimum choice using: a) optimization in levels. b) optimization in differences. Apartment Commuting Time to University (hours per month) Commuting Time to Music Classes (hours per month) Rent ($ per month) 1 10 10 2,500 2 16 24 2,200 3 36 24 1,900 4 45 35 1,800
Why was the Munn v Illinois (1877) court case particularly important with regard to government regulation?
(a) It upheld the traditional right of businesses to act freely without interference by government. (b) It established the right of government at any level to regulate any business activity if it was deemed desirable for any reason. (c) It established the right of government to regulate any and all businesses wherever it was deemed desirable to promote competition. (d) It established the right of government to regulate any business that had become "clothed in the public interest."
In a command economy, the basic economic questions are answered by:
a. central authority. b. individual buyers and sellers. c. the traditional methods. d. none of these.