Which of the following statements is false?
a. Political activities consistent with economic efficiency tend to emerge naturally from the unconstrained democratic political process.
b. Constitutional rules establishing procedures and limiting the ability of the political process to engage in redistributive activities can improve the economic efficiency of government.
c. Rent-seeking activity tends to retard the economic prosperity of a nation because it takes resources away from productive private sector activities.
d. Unconstrained democratic governments often enact special-interest programs that waste resources and impair the standard of living of a country.
A
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Over the last twenty years, real GDP in the U.S. economy has increased and there has been inflation. This indicates that
A) aggregate demand has been constant while aggregate supply has increased. B) aggregate demand has increased more than aggregate supply. C) aggregate demand has increased while aggregate supply has been constant. D) aggregate demand has increased less than aggregate supply.
A tariff on shoes would lead to: a. a higher price for shoes for domestic consumers
b. greater sales of shoes at higher prices for domestic producers. c. lower sales of foreign shoes. d. all of the above
You are a member of your city's cable television regulatory commission. For the third time this year, the local cable provider has come before the commission, asking for a rate increase. This time it is to cover the cost of new, state-of-the-art cable
relay equipment. Last month it was for money for advanced training for cable installers. The time before that, it wanted to cover the cost of new office equipment. How do you explain the cable company's behavior?
If the Fed wants banks to have more money to lend, it can
A. sell government securities. B. raise the reserve ratio. C. lower the reserve ratio. D. raise its discount rate.