In competitive industries, firms that innovate can expect to make no profit in the short run
Indicate whether the statement is true or false
F
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When the Fed buys securities from the public, banks' reserves ________ and the quantity of money ________
A) increase; increases B) increase; decreases C) decrease; increases D) decrease; decreases E) do not change; increases
The double taxation problem occurs because households pay taxes on dividends and capital gains from stock and corporations pay taxes on corporate profits
Indicate whether the statement is true or false
Investment is a flow of resources into the production of new capital
a. True b. False Indicate whether the statement is true or false
Keynesian economists believed that the prolonged unemployment of the 1930s was the result of
a. the sharp reduction in the supply of money during 1929-1933 and another monetary contraction in 1938. b. the high interest rates of the 1930s. c. the double-digit inflation of the 1930s. d. insufficient aggregate demand and the failure of market forces to direct the economy back to full employment.