Suppose the government decides that a particular commodity is a luxury and decides to fix its price above the market-determined price. What implications could this policy have?
What will be an ideal response?
If the government fixes the price of a commodity above the market-determined price, it will provide an incentive to sellers to supply more. This will result in an excess supply of the commodity.
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Use the following graph of the total demand for money to answer the next question.
Assume we begin at point a. An increase in the real GDP will can be shown as a move to ________.
A. point b B. point c C. point d D. point e
What is cyclical unemployment?
What will be an ideal response?
During 1980-2010, the per-capita incomes of less-developed countries (LDCs)
a. grew rapidly. b. declined. c. were virtually unchanged. d. registered a mixed growth record; some grew rapidly while others stagnated.
Direct financing is distinguished from indirect financing because:
a. Direct financing is when a business borrows directly from pooled funds at a financial institution, and indirect financing is when it borrows in the bond or stock market. b. Direct financing is when a company borrows in the fixed-rate market, and indirect financing is when it borrows in the floating-rate market. c. Direct financing is when a business borrows in the bond or stock market, and indirect financing is when it borrows from pooled funds at a financial institution. d. None of the above.