Economic theory indicates that the economy is better off not to produce proved reserves of a mineral "too quickly." By this, we mean that we
a. prefer some bad luck in exploration efforts, rather than too much good luck in finding the resources.
b. do not want the resource to be too abundantly available since this would reduce its price and GDP.
c. want to use other nations' resources first, even if doing so is more costly.
d. do not want to use additional resources for exploration if the present discounted value of the benefits is smaller than the cost.
D
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If the price of salt increases and the quantity demanded does not change, then
A) the price elasticity of demand is equal to zero. B) demand is perfectly inelastic. C) the demand curve for salt is horizontal. D) Both answers A and B are correct.
If the money supply expands to much it lowers the value of the dollar?
Indicate whether the statement is true or false
Which of the following lies primarily within the realm of macroeconomics?
A. a study of the demand for gasoline B. a study of how tax cuts stimulate aggregate production C. an analysis of supply and demand conditions in the electricity market D. a study of the impact of "mad cow" disease on the price of beef worldwide
In theory, partially-flexible exchange rates:
A. permit sizable exchange rate fluctuations, as long as they foster movement toward the long-run equilibrium exchange rate. B. require a very high level of official reserves. C. allow speculative pressures to affect exchange rates. D. impose no limitations on a country's monetary and fiscal policy.