Inefficiency is a flaw of a command economy because there is less incentive for resources to flow to their highest-valued uses
a. True
b. False
A
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If a corporation earns a profit, how do owners of the firm share in the profit?
A) by selling any bonds or stocks owned and realizing a capital gain B) by raising the interest rate on bonds C) through coupon payments on that firm's bonds D) through dividend payments on shares of that firm's stock
The substitution effect of an increase in the price of peaches is
A) the change in the quantity of peaches demanded that results from the effect of the change in the price of peaches on the consumer's purchasing power. B) the change in the demand for nectarines (a substitute good) that results when peaches become more expensive relative to nectarines, holding constant the effect of the price change on consumer purchasing power. C) the change in the demand for peaches that results when the price of peaches increases. D) the change in the quantity demanded that results from a change in the price of peaches, making peaches more expensive relative to other goods, holding constant the effect of the price change on consumer purchasing power.
Withholding of the federal income tax _____
a. was first used during the civil war b. was first used during World War I c. was first used during World War II d. was first used after World War II
If a firm is selling a quantity that is NOT on its best-response curve it
A) will go out of business. B) is in a Nash equilibrium. C) will want to change its behavior. D) is operating in a duopoly.