The "invisible hand" directs economic activity through
a. advertising.
b. prices.
c. central planning.
d. government regulations.
b
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Which of the following represents a positive statement?
a. A higher income tax rate will reduce the amount of time that people spend working. b. Teenage unemployment should be reduced. c. We should raise the standard of living for the elderly. d. A decrease in tax rates is needed to help the poor.
Land of Many Lakes (LML) sells butter to a broker in Albert Lea, Minnesota. Because the market for butter is generally considered to be competitive, LML
a. can choose the price at which it sells its butter but not the quantity of butter that it produces. b. can choose quantity of butter that it produces but not the price at which it sells its butter. c. can choose both the price at which it sells its butter and the quantity of butter that it produces. d. cannot choose either the price at which it sells it butter or the quantity of butter that it produces.
The discount rate is
a. the rate at which public banks lend to other public banks. b. the rate at which the Fed lends to banks. c. the percentage difference between the face value of a Treasury bond and what the Fed pays for it. d. the percentage of deposits banks hold as excess reserves.
Explain why the government is often more responsive to producer interests than to consumer interests when it comes to the imposition of tariffs and quotas