The existence of income transfer programs indicates that the market mechanism has failed.
Answer the following statement true (T) or false (F)
True
Income transfer programs exist because market outcomes result in too much income for some groups and too little for others.
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In November 2008, Grand Canyon Education chose to finance expansion by offering ownership in its firm. These owners of Grand Canyon Education the are entitled to a share of the firm's profits. This financing is an example of ________
A) a mortgage B) a bond C) issuing stock. D) gross investment
The income elasticity for cars is high. During the late 1960s, some U.S. citizens experienced a decrease in their real incomes. Consequently, they purchased
(a) more expensive U.S. cars. (b) more foreign imports due to their relatively low costs. (c) used U.S. cars in order to avoid foreign imports. (d) U.S. cars of any type to avoid foreign imports.
If the marginal propensity to consume (MPC) is 0.8, the spending multiplier will be
A) 0.2. B) 1.25. C) 4.0. D) 5.0.
The entity that carries full responsibility for setting the overall direction of monetary policy and guiding the money supply is the:
A. Federal Open Market Committee. B. Federal Reserve Chairman. C. Board of Governors. D. regional bank presidents' cabinet.