Laissez-faire capitalism limits the government's economic functions to the following, except:
A. Protecting private property rights
B. Establishing a legal environment to enforce contracts among individuals
C. Preventing individuals and firms from coercing others
D. Setting prices of individual goods and services
Answer: D
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As measured, GDP omits which of the following? i. Illegal sales of goods and services ii. Changes in the amount of leisure time iii. Household production of goods and services
A) i only B) i and ii C) ii and iii D) i and iii E) i, ii, and iii
Which of the following is a primary function of money?
A) to serve as a unit of account B) to serve as an encouragement to work C) to reduce the burden of excessive imports D) to raise funds for the government
The introduction of sweep accounts
A) was an open market purchase. B) was a failure. C) had no effect. D) caused a reduction in the demand for money.
If the production possibilities curves of two countries have the same slope,
a. neither has a comparative advantage, and there are no gains from trade. b. although there is no comparative advantage, there are potential gains if there are differences in absolute advantage. c. neither has an absolute advantage, and there cannot be gains from trade. d. both have an absolute advantage, and can gain from trade.