Which of the following is a major source of inefficiency?
A. price taking
B. market power
C. perfect competition
D. all of the above
Answer: B
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Economists use models in order to
A. get around having to deal with actual facts. B. understand real-life events and predict outcomes. C. avoid having to use theories to understand economic conditions. D. help elect political candidates.
Fluctuating interest rates tend to stabilize real output when the
A) IS curve is flat. B) IS curve is steep. C) LM curve is flat. D) LM curve is steep.
One of the provisions of the second stimulus bill increased the amount of investment spending that firms were allowed to depreciate for tax purposes from 50% to 100%
This is just one of over 100 temporary tax provisions affecting firms in the United States. Temporary tax breaks such as the increase in depreciation will tend to A) increase investment expenditures because the tax breaks will entice firms to leave other countries and invest in the United States. B) have little impact on current investment expenditures since the tax breaks are temporary. C) increase investment expenditures in both the short run and the long run, since investment is irreversible. D) increase investment expenditures in the short run but also increase the uncertainty and volatility of investment since the tax breaks are temporary.
Money is defined as
a. the currency of a nation. b. anything that is commonly accepted in exchange for other goods and services. c. currency that has been designated as legal tender. d. notes issued by the U.S. Treasury and backed by gold.