A decrease in supply results in a(n)
a. decrease in demand
b. increase in equilibrium quantity and a decrease in equilibrium price
c. decrease in equilibrium quantity and a decrease in equilibrium price
d. increase in demand
e. increase in equilibrium price and a decrease in equilibrium quantity
E
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In the classical model, people hold money because
a. it is a way to save. b. it makes trade easier. c. it is the way to measure the value of goods and services. d. it is an asset.
The Federal Reserve is anticipating a contractionary period in the economy. The Fed decides to engage in open market operations to stimulate the economy. This action is
A) active policy making. B) passive policy making. C) the monetary rule. D) Phillips policy making.
In cost-benefit analysis, regulatory intervention can be justified if the
A. Value of government failure exceeds the value of market failure. B. Marginal benefit of regulation exceeds its marginal cost. C. Economic cost of regulation exceeds the value of the improvements in government intervention. D. Intervention improves market outcomes, regardless of costs.
Cooperation is difficult to achieve in a Prisoners' Dilemma because each player thinks the other player might not cooperate.
Answer the following statement true (T) or false (F)