The quantity theory of money
a. is a fairly recent addition to economic theory.
b. can explain both moderate inflation and hyperinflation.
c. argues that inflation is caused by too little money in the economy.
d. All of the above are correct.
b
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The points along the supply curve represent the maximum willingness of firms to accept payment for a product offered for sale at various prices
a. True b. False Indicate whether the statement is true or false
The preferences between baskets of outcomes when the state of the world is not yet known are called
a. ex ante preferences. b. ex post preferences. c. risk-averse preferences. d. diversified preferences.
If the Congress passes legislation to cut taxes to counter the effects of a severe recession, then this would be an example of a(n):
A. nondiscretionary fiscal policy. B. political business cycle. C. contractionary fiscal policy. D. expansionary fiscal policy.
Adjudication reduces problems created by negative externalities by
A) assigning liability to the party most able to pay (the deep pocket).
B) balancing marginal social benefits against marginal social costs.
C) discovering who has what rights.
D) making more accurate private benefit-cost analyses.
E) measuring externalities more precisely.