A car's real cost is its opportunity cost. Opportunity cost is determined by
A. relative prices.
B. the price of the car.
C. wealth.
D. the prices of the goods that are compliments to a car.
Answer: A
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If net exports is 100 and the private sector balance is 150, then the government sector balance is
A) -50. B) 50. C) 250. D) 0.
The first economist to systematically analyze market failure was
A) Adam Smith. B) J. E. Meade. C) Ronald Coase. D) A. C. Pigou.
The 1920s were characterized by large numbers of bank failures each year, especially among country banks. Country banks were particularly inclined to fail because:
a. they tended to open too many branches. b. they were not allowed to issue checking accounts. c. they were not allowed to join the Federal Reserve system. d. farm mortgages constituted the major portion of their loans. e. All of the above.
If the price of labor goes up and a firm replaces some workers with more machines, this is the _______ effect; when the price of a resource declines, and consequently the level of production rises, this is the _______ effect.
Fill in the blank(s) with the appropriate word(s).