Which of the following statements is true?
A) Command economies do a better job at maximizing social welfare in comparison to market economies.
B) The incentive problem and the coordination problem lead to lower efficiency in market economies.
C) Central planners in command economies have to make decisions that prices would have automatically made in market economies.
D) Bringing economic agents together to trade is easier in command economies in comparison to market economies.
C
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If the yield curve has a mild upward slope, the liquidity premium theory (assuming a mild preference for shorter-term bonds) indicates that the market is predicting
A) a rise in short-term interest rates in the near future and a decline further out in the future. B) constant short-term interest rates in the near future and further out in the future. C) a decline in short-term interest rates in the near future and a rise further out in the future. D) a decline in short-term interest rates in the near future and an even steeper decline further out in the future.
The optimal treatment of a tax on a stock of wealth depends ____
a. on how the flow of income from that wealth is taxed b. on how the stock itself is taxed c. on whether or not there is an estate tax d. on the size of a stock
When a random demand and marginal cost are linear, producing the quantity at which the marginal cost equals the ________ maximizes ________.
A) expected marginal revenue; expected profit B) marginal revenue; profit C) marginal revenue; expected profit D) expected marginal revenue; profit
In 2009, the U.S. budget deficit was $1.4 trillion
a. True b. False Indicate whether the statement is true or false