Define the term scarcity and discuss two of its consequences
Scarcity is the condition in which our wants are greater than the limited resources available to satisfy those wants. The consequences of scarcity include: (1 ) the need to make choices, (2 ) the need for a rationing device, and (3 ) competition.
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Compared to the 1973 to 1995 period, average real earnings of workers ________ from 1960 to 1973.
A. grew at about the same rate B. grew more slowly C. grew more rapidly D. declined
The Federal Reserve Open Market Committee includes the seven members of the Board of Governors, presidents of five of the twelve district banks, and the Secretary of the Treasury
a. True b. False Indicate whether the statement is true or false
Figure 5-3
illustrates the market for a product that generates an external benefit. D1 is the private market demand curve, while D2 is the demand curve including the external benefit. Which of the following is true?
a.
Point a illustrates the competitive private market outcome, while point b illustrates the outcome consistent with economic efficiency.
b.
Point b illustrates the competitive private market outcome, while point a illustrates the outcome consistent with economic efficiency.
c.
The competitive private market outcome is consistent with the conditions for economic efficiency.
d.
The good will tend to be oversupplied relative to the conditions for economic efficiency.
Studies of mutual fund performance indicate that mutual funds that outperformed the market in one time period usually
A) beat the market in the next time period. B) beat the market in the next two subsequent time periods. C) beat the market in the next three subsequent time periods. D) do not beat the market in the next time period.