Policymakers are discussing various proposals regarding how to deal with natural monopolies. Senator Huff wants to regulate natural monopolies by equating price with average total cost. Huff contends that such a policy will ensure that monopolies make every effort to reduce costs. Senator Puff wants the government to own natural monopolies. Puff argues that government-owned monopolies usually do
a better job of holding down costs than privately owned monopolies. Which senator's argument is correct?
a. Senator Huff
b. Senator Puff
c. both senators
d. neither senator
d
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One clear triumph for New Classical macroeconomics is its contribution to the analysis of hyperinflation
In bringing extremely rapid inflation to a halt by radical changes in policy, there is generally ________ loss of output, which ________ the Policy Ineffectiveness Proposition. A) only a modest, supports a mild form of B) only a modest, completely overturns C) a major, supports a mild form of D) a major, completely overturns
Unlimited wants need not be a problem if
A. resources are also unlimited. B. resources are flexible in what they can do. C. resources are basic energy resources like oil. D. resources are human resources such as skilled labor.
Which of the following statements about central bank structure and independence are true?
A) In recent years, with the exception of the Bank of England and the Bank of Japan, most countries have reduced the independence of their central banks, subjecting them to greater democratic control. B) Before the Bank of England was granted greater independence, the Federal Reserve was the most independent of the worlds central banks. C) Both theory and experience suggest that more independent central banks produce better monetary policy. D) While the European Central Bank is independent, it is not as independent as the Federal Reserve.
An example of a good or service that would count in the U.S. GDP would be a bag of coffee made in:
A. Canada by Starbucks. B. Vermont by Green Mountain Coffee Roasters. C. Colombia by Dunkin' Donuts. D. All of these would count in U.S. GDP.