The financial system
a. involves bank accounts, mortgages, stock prices, and many other items.
b. involves decisions and actions undertaken by people at a point in time that affect their lives in the future.
c. coordinates the economy's saving and investment.
d. All of the above are correct.
d
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At full employment,
A) the inflation rate is zero. B) the inflation rate must equal the natural unemployment rate. C) the unemployment rate is zero. D) real GDP exceeds potential GDP. E) the unemployment rate is equal to the natural unemployment rate.
Economists can objectively evaluate the desirability of the distribution of income.
Answer the following statement true (T) or false (F)
The following input-requirements data are for Country A, a capital-abundant country that produces nothing but bread and wine using only capital and labor as inputs. 1 Pound of Bread1 Gallon of WineCapital Input5 units2 unitsLabor Input4 units1 unit Which of the following is most likely to happen if Country A engages in free trade with other countries?
A. The prices of both bread and wine will fall in the domestic market. B. The price of bread will rise but the price of wine will fall in the domestic market. C. The price of bread will fall but the price of wine will rise in the domestic market. D. The prices of both bread and wine will rise in the domestic market.
Figure 16.3Figure 16.3 depicts a market for electricity. S1 is the supply curve without the external costs. S2 is the supply curve with the $T tax. Assume electricity production incurs external costs. If the government imposes the pollution tax in the amount illustrated, the amount of the pollution tax shifted forward on to consumers is:
A. PA - PB. B. PA - PC. C. PB - PC. D. (1/2)?(PB - PC).