Which of the following statements is true?
A. The United States today comes closer to the socialist form of economic organization than it does capitalism.
B. When central planners set prices above equilibrium for goods and services they create shortages.
C. According to Karl Marx, under capitalism, workers would be exploited and would revolt against the owners of capital.
D. Adam Smith argued that government's role in society would be to do absolutely nothing.
Answer: C
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The major role of a commercial bank is to
A) make mortgage loans. B) sell shares and use the proceeds to buy stocks. C) receive deposits and make loans. D) restrain the growth of the quantity of money.
Moral hazard occurs when the parties on once side of the market, who have information not known to others, self select in a way that adversely affects the parties on the other side of the market.
Answer the following statement true (T) or false (F)
Refer to the diagram. Line (2) reflects the long-run supply curve for:
A. a constant-cost industry.
B. a decreasing-cost industry.
C. an increasing-cost industry.
D. a technologically progressive industry.
Autonomous consumption is _________.
