According to the Ricardian equivalence theorem, people increase savings when the government increases deficits because they recognize the link between government deficits and higher future taxes.
Answer the following statement true (T) or false (F)
True
According to the Ricardian equivalence theorem, people increase savings when the government increases deficits because they recognize that those deficits must be paid in the future with higher taxes.
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Which of the following statements is true with respect to nonrenewable natural resources?
a. With proper management, more natural resources can be created. b. The economy will never run out of the resource since it can always find new supplies as the price rises. c. Economists can predict with reasonable accuracy when the supply will be depleted. d. Before the last unit is taken from the earth, the economy is likely to already have abandoned it and switched to another. e. Water is an example of a nonrenewable natural resource.
Refer to the scenario above. If the government removes the ban on Firm B and both Firm A and firm B aim at maximizing profits:
A) marginal cost of Firm A will eventually be greater than the marginal cost of Firm B. B) marginal cost of Firm B will eventually be greater than the marginal cost of Firm A. C) marginal cost of both firms will eventually be equalized. D) the difference in the marginal cost of both firms will eventually increase.
Refer to Figure 7.1. The diagram above contains ________ cost curves
A) short run B) intermediate run C) long run D) both short run and long run.
In the 1970s when US President Richard M. Nixon ended the gold standard,
a) barter became the predominant method of transacting business b) silver took the place of gold c) hyperinflation occurred d) he created a pure fiat money e) a run on banks ensued