Initially, policy makers were not concerned about the financial crisis because:
A. fiscal policy would kick in to stabilize the economy.
B. banks and other financial institutions had convinced policy makers that they would take care of any type of crisis.
C. no other comparable crisis had happened before in history.
D. conventional economic theory was telling them they did not have to worry about such an event occurring.
Answer: D
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Having seen the quantity of drugs supplied by pharmaceutical companies in a competitive market, a government decides to force companies to sell exactly the same quantity of drugs at prevailing market prices
The government then forbids additional drug sales and allows doctors to prescribe the drugs at no cost to patients in need. This government scheme is A) efficient as the quantity of drugs traded is the same as under a free market. B) efficient as the price of drugs paid by the government is the same as under a free market. C) efficient as consumer surplus is maximized. D) likely to be inefficient as doctors are unlikely to prescribe drugs to the consumers who are willing to pay the most for the drugs. E) likely to be inefficient as drug producers have a captive buyer.
Total physical product shows what happens to the quantity of an output when the firm changes the quantity of an input
a. True b. False Indicate whether the statement is true or false
A nation's capital stock is increased by increases in
a. consumption spending. b. government spending. c. investment spending. d. net exports.
The unemployment rate measures the:
a. percentage of the labor force who are not working but looking for work. b. percentage of the labor force who have failed to find work in the last 2 months. c. percentage of working adults lacking proper technical skills. d. percentage of the labor force incapable of productive work.