Adam Smith's ________ refers to the process by which individuals acting in their own self-interest bring about a market outcome that benefits society as a whole
A) Utopian society
B) comparative advantage model
C) invisible hand
D) survival of the fittest theory
Answer: C
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If two countries are economically identical except that citizens in one country have more leisure time, then the level of GDP:
A. will be the same in both countries. B. will be higher in the country with more leisure time. C. will be higher in the country with less leisure time. D. will be greater than the level of economic well being in each country.
Refer to Figure 16-12. An increase in government purchases of $200 billion causes aggregate demand to shift ultimately from AD1 to AD2
Assuming a constant price level, the difference in real GDP between point A and point B will be ________ $200 billion. A) less than B) greater than C) equal to D) There is insufficient information given here to draw a conclusion.
An aggregate supply curve that slopes upward must be:
A. a short-run curve. B. a long-run curve. C. an individual firm's supply curve. D. an individual industry's supply curve.
Which of the following is true?
a. Efficiency refers to the size of the economic pie; equality refers to how the pie is divided. b. Government policies usually improve upon both equality and efficiency. c. As long as the economic pie continually gets larger, no one will have to go hungry. d. Efficiency and equality can both be achieved if the economic pie is cut into equal pieces.