Given that resources can be allocated by the government, the market, a random process, or on a first-come first-serve basis, which of the following statements is true?
a. The market system is not entirely fair but it creates incentives to increase supplies and improve standards of living.
b. The random process of allocation allows individuals to acquire purchasing power and enhances the value of the resources that they own.
c. Since the government system does not distinguish between those who have income and those that do not, government allocation of resources is the most efficient.
d. There will be no shortages under the first-come first-serve basis of allocation.
e. A random process of allocation is fair in the sense that everyone gains and there are no losers.
a
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Based on Figure 3.2, it can be inferred that:
A) Alvin does not consider good X as "good." B) Alvin will never purchase any of good Y. C) Alvin regards good X and good Y as perfect substitutes. D) Alvin regards good X and good Y as perfect complements. E) none of the above
Mechanisms that manufacturers can use to deal with misaligned retailer incentives include
a. setting a maximum retail price b. allowing many retailers to sell the product in each market c. preventing retailers from compensating sales staff for demonstrating the product d. providing manufacturer staff to demonstrate the product in stores
If the marginal propensity to consume is 0.6 and investment spending declines by $50 billion, by how much will equilibrium output change?
a. -$125 billion b. -$83.3 billion c. -$50 billion d. $83.3 billion e. $125 billion
Which of the following is consistent with the idea that high money supply growth leads to high inflation?
a. the quantity theory and evidence from four hyperinflations during the 1920's b. the quantity theory but not evidence from four hyperinflations during the 1920's c. evidence from four hyperinflations during the 1920's but not the quantity theory d. neither the quantity theory nor evidence from four hyperinflation during the 1920's