The markets for renewable and nonrenewable resources operate to ensure that:
a. the producers using these resources earn above-normal profits even in the long run.
b. the current and future prices of such resources remain high.
c. the cost of extraction of such resources increases with an increase in price.
d. the current price of such resources should remain low but the future prices should increase to increase profitability of the producers.
e. the current and future wants for these resources are satisfied in the least costly manner.
e
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One of the reasons for the growth performance of free-market economies is firms’ use of innovation to compete with one another.
Answer the following statement true (T) or false (F)
Quantitative easing refers to a policy action in which a central bank
A) sells government securities to directly decrease bank reserves. B) decreases interest rates directly without altering bank reserves. C) increases interest rates directly without altering bank reserves. D) buys government securities to directly increase bank reserves.
When the government contributes to a public good, private contributions will fall.
Answer the following statement true (T) or false (F)
When Argentina fixed the exchange rate of their peso to the U.S. dollar, one outcome was:
A. Argentinean central bankers regained control of their domestic interest rate. B. Argentinean central bankers were finally able to focus their attention on domestic monetary policy. C. Argentineans began using the U.S. dollar for all of their transactions. D. Argentinean central bankers effectively gave control of their domestic interest rate to the FOMC.