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.
c
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Is it possible for nominal GDP to increase while real GDP does not change?
What will be an ideal response?
The short-run Phillips curve tells us, in theory, what combinations of:
A. inflation and output are feasible. B. the price level and output are feasible. C. the price level and unemployment are possible when expectations of inflation are constant. D. inflation and unemployment are possible when expectations of inflation are constant.
Aggregate demand decreases and real output falls but the price level remains the same. Which factor would most likely contribute to downward price inflexibility?
A. Menu costs. B. Lower interest rates. C. An increase in aggregate supply. D. The real-balances effect.
If the price elasticity of demand for good A is -4, then a 2% increase in
A. consumer income will result in a 2% decrease in the demand for good A. B. the market price of good A will result in a 8% increase in the quantity demanded of good A. C. consumer income will result in a 2% increase in the demand for good A. D. the market price of good A will result in a 8% decrease in the quantity demanded of good A.