It may be necessary to ration a good whenever ___________ exists.
A. a surplus
B. excess demand
C. excess supply
D. None of these choices are correct.
B. excess demand
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People learn to hold a specific quantity of money for the groceries, theater tickets, gasoline, clothes, film, and other items they habitually purchase. This behavior is representative of the:
a. precautionary demand. b. speculative demand. c. transactions demand. d. volatility demand. e. liquidity demand.
The opportunity cost of the debt is the change in the mix of output that occurs when public sector spending crowds out private sector spending.
Answer the following statement true (T) or false (F)
In the short run, fiscal and monetary policy cause unemployment and inflation to move in opposite directions because
A. the Fed and Congress rarely agree on policy. B. one controls aggregate demand, the other controls aggregate supply. C. both policies control only aggregate supply. D. both policies control only aggregate demand.
Which of the following sets of personal characteristics best reflects what behavioral economists assume about how people make decisions?
A. People are irrational, are prone to systematic errors, have stable preferences, and care about fairness. B. People are rational, adjust for errors, have stable preferences, and easily resist temptation. C. People care deeply about fairness, eagerly and accurately calculate ways to help others, assess future and present options equally well, and resist temptations in their selflessness. D. People have preferences that depend on context, avoid and are bad at computation, often give in to temptation, and are often selfless in their behavior.