Mainstream economists focus on:
A. cultural and historical aspects of the market.
B. the tensions among social classes.
C. how the invisible hand achieves equilibrium through the market.
D. political restrictions that provide rents to various groups.
Answer: C
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Suppose the price of gasoline is $3.50 per gallon, the quantity of gasoline demanded is 150 billion gallons per year,
the price elasticity of demand for gasoline is -0.06, and the federal government decides to increase the excise tax on gasoline by $1.00 per gallon, which increases the price of gasoline by $0.75 per gallon. What is the new equilibrium quantity of gasoline demanded after the tax is imposed? A) 109.72 billion gallons per year B) 127.25 billion gallons per year C) 148.27 billion gallons per year D) 161.61 billion gallons per year
Based on Table 3.1, trade between the United States and Mexico will occur as long as the relative price of shoes is between
A) three computers and one computer. B) three computers and two computers. C) one-half computer and one-third computer. D) six computers and three computers. E) None of the above.
A mutual fund
a. is a financial market where small firms mutually agree to sell stocks and bonds to raise funds. b. is funds set aside by local governments to lend to small firms who want to invest in projects that are mutually beneficial to the firm and community. c. sells stocks and bonds on behalf of small and less known firms who would otherwise have to pay high interest to obtain credit. d. is an institution that sells shares to the public and uses the proceeds to buy a selection of various types of stocks, bonds, or both stocks and bonds.
Which of the following is a characteristic of capitalism?
A. equality of income B. government decision-making is preferred to decentralized decision-making C. market determination of prices and quantity D. government ownership of all capital