When natural resources are not traded, or where markets are not allowed to function as well as they can under a system of well-defined property rights, the problems of ____ and ____ are common
a. higher taxes; increased regulation
b. waste; scarcity
c. inflation; unemployment
d. slow growth; fluctuating currency values
B
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Last year, the unemployment rate was 4 percent and the inflation rate was 3 percent. If the natural rate of unemployment is 3 percent, how do you expect inflation to change?
What will be an ideal response?
Which of the following statements is true?
A. No good can be inferior at all levels of income. B. The income elasticity of demand is negative for normal goods. C. It is possible for a good to be inferior at all income levels. D. It is possible for all of the goods a consumer buys to be inferior.
Most sales taxes are __________; most excise taxes are __________.
A. progressive; progressive B. regressive; regressive C. progressive; regressive D. regressive; progressive
All but one of the following statements is used to justify protectionism. Which statement is not used to justify protectionism?
A) Free trade leads to higher prices for imported goods. B) Free trade reduces employment by driving domestic firms out of business. C) A country should not rely on other countries for goods that are critical to its national defense. D) Trade restrictions are necessary to protect new firms until they can gain experience and become more productive.