Most economists in the U.S. believe that the price mechanism leads to
A. an efficient allocation of resources.
B. an equitable distribution of income.
C. both an efficient allocation of resources and an equitable distribution of income.
D. neither an efficient allocation of resources nor an equitable distribution of income.
A. an efficient allocation of resources.
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In order to maintain a fixed exchange rate:
A. a country cannot change its money supply. B. a country must constantly increase its money supply. C. a country must constantly decrease its money supply. D. Maintaining a fixed exchange rate is unrelated to the money supply.
The self-correcting property of the economy means that output gaps are eventually eliminated by:
A. increasing or decreasing potential output. B. government policy. C. decreasing inflation only. D. increasing or decreasing inflation.
As the number of days without rain increases, the amount of wheat grown per acre declines. A graph showing this relationship shows
A) a vertical line. B) a positive relationshi
With regard to its economic profits and economic losses, how is the short run different from the long run for a perfectly competitive firm?
What will be an ideal response?