The rationing function of prices refers to
A. the synchronization of decisions by buyers and sellers that leads to an equilibrium.
B. the situation when government must intervene in a market when there is a large shortage or surplus.
C. the situation when only the rich get the goods they want.
D. the synchronization of decisions by buyers and sellers through the direction of government agencies.
Answer: A
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According to the figure above, the opportunity cost of producing another computer is
A) higher at A. B) higher at B. C) the same at every point along the frontier. D) different at most points along the frontier but equal at points A and B because they are equally distant from the axes.
An important difference between the demand for a private good and the demand for a public good is that
A) the resources used to provide public goods are common resources or government owned; the resources used to produce private goods are all privately owned. B) individuals reveal their preferences for a public good but they do not have to reveal their preferences a private good. C) the demand for a private good produces consumption externalities; the demand for a public good produces production externalities. D) individuals reveal their preferences for a private good but they do not have to reveal their preferences for a public good.
What statement best describes the colonial economic experience?
a. The agricultural sector was initially a small portion of the economy, but quickly grew to be the largest sector. b. By the time of the American Revolution, the U.S. colonial economy was larger than about 70 percent of other nation's economies. c. The U.S. colonial economy was particularly hurt during the Seven Year's War. d. Economic growth was irregular and averaged about 0.45% per year.
The monetary rule is the view of the:
a. Monetarists that monetary policy is most important. b. Keynesians that monetary policy is most important. c. Classical economists that monetary policy is most important. d. Monetarists that the Fed should expand the money supply at a constant rate.