A decision by Congress to reduce spending in order to balance the government's budget is an example of ________ policy.
A. monetary
B. fiscal
C. structural
D. aggregation
Answer: B
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Since price tends to equal marginal utility, the price of water is low and the price of diamonds is high.
Answer the following statement true (T) or false (F)
Due to resource scarcity,
a. some economic activities have an opportunity cost b. all economic activities have an opportunity cost c. no economic activities have an opportunity cost d. economic activities have opportunity costs equal to their market prices e. economic activities have opportunity costs generally lower than their market prices
To calculate the total utility of consuming N quantity of a product:
A. add the total satisfaction of consuming each product up to N. B. multiply the additional satisfaction from consuming the Nth product by its price. C. add the additional satisfaction of consuming each product up to N and multiply by its price. D. multiply total satisfaction from consuming N products by N.
Suppose that product prices start rising but nominal wages do not. In that case,
A. real wages will fall and firms will want to produce more because doing so will be profitable. B. real wages will rise and firms will want to produce more because doing so will be profitable. C. there will be a surplus of goods and services produced. D. there will be a shortage of goods and services produced.