The three broad types of factors of production are:
A) capital, labor, and natural resources.
B) money, profit, and interest.
C) stocks, bonds, and financial assets.
D) technology, human capital, and comparative advantage.
Ans: A) capital, labor, and natural resources.
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What is an imperfectly competitive industry?
What will be an ideal response?
In order to prove that Dr. Pepper and 7-Up are substitutes, the FTC should test the ____ and get a ____
a. price elasticity of demand; number less than 1 b. income elasticity; positive number c. price elasticity; negative number d. price elasticity of demand; number greater than 1 e. cross-price elasticity; positive number
Most analysts in the United States and the international financial community initially perceived the debt crisis as a temporary, short-run liquidity problem so they advised increasing capital flows to Latin America
Indicate whether the statement is true or false
According to the rational expectations hypothesis, the attempt by the government to reduce unemployment below its natural rate through expansionary policies will
A. succeed because the government knows how people will react to their policies and will adjust their policies accordingly. B. succeed in the short run and can succeed in the long run as long as the government makes it clear what its goals are. C. fail because the economy can never achieve an unemployment rate below the natural level. D. fail because people will figure out what the government is doing and alter their expectations and their behavior in ways that counteract the government policy.