A country produces cars and books. All of its resources are currently being employed in the production of these two goods. If this country increases the production of cars, what will happen with the quantity produced of books?
A) The quantity of books produced will not change.
B) The quantity of books produced will decrease.
C) The quantity of books produced will slightly increase.
D) The quantity of books produced will substantially increase .
B
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The long-run aggregate supply curve is horizontal
Indicate whether the statement is true or false
Lower interest rates are generally charged on more risky investments and on securities that have longer maturities
Indicate whether the statement is true or false
To promote economic efficiency, government should
A. keep all prices as low as possible. B. keep all prices high so that people will save more money. C. allow the market to set low prices for abundant goods and high prices for scarce goods. D. never interfere with firms’ price setting powers.
The inflation tax
a. is an alternative to income taxes and government borrowing. b. taxes most those who hold the most money. c. is the revenue created when the government prints money. d. All of the above are correct.