Each of the following is an example of the price mechanism at work, except when
A. wage and price controls were used during World War II to control inflation.
B. consumers curtailed driving their cars when the price of gasoline increased dramatically in 2005.
C. American farmers during World War I expanded production on previously unused land in response to higher crop prices.
D. factories of gas-guzzling automobiles shut down when the price of gasoline triples in less than three months.
A. wage and price controls were used during World War II to control inflation.
You might also like to view...
Since it spent over $3.6 trillion in 2010, opportunity cost was not an issue for the U.S. government
a. True b. False Indicate whether the statement is true or false
In nations where the supply of real loanable funds is inelastic, the real risk-free interest rate is likely to:
a. To fluctuate more than the equilibrium quantity of loanable funds per period. b. Be very stable over time and not to react strongly on changes in demand. c. Be high compared to countries where the supply of real loanable funds is elastic. d. None of the above.
The Board of Governors of the Federal Reserve System is the key decision maker for monetary policy.
a. true b. false
The current deficit is
A. the deficit minus current expenditures. B. the deficit minus depreciation. C. the deficit plus net interest payments. D. the deficit minus government investment.