A process of _____ among candidates in a representative democracy leads to the outcome preferred by the median voter
a. cheating
b. political competition
c. bargaining
d. log-rolling
b
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Suppose you have $400 to invest at a nominal interest rate of 7 percent, and the investment's term to maturity is 1 year. If the inflation rate is 2 percent, then the real return on your investment is approximately
A) $8. B) $20. C) $28. D) $36.
To increase the money supply
A) the Federal Reserve should sell government securities. B) the Federal Reserve should reduce its loans to banks. C) the Federal Reserve should buy government securities. D) the commercial banks should reduce their loans.
The Commodity Credit Corporation (CCC) instituted several policies to improve the welfare of farmers. Which of the following best describes the programs' effects?
a. The CCC price supports mandated a one-price policy on all agricultural goods. b. The CCC made loans to farmers, using the farmers' future crops as collateral with recourse. c. The CCC price supports inefficiently allocated resources, which decreased welfare. d. If the commodity price increased, according to the free market, then the CCC would command and collect "excess" profits, i.e., revenues in excess of the one-price policy, for use as loanable funds.
______ efficiency means production will be allotted to reflect consumer preferences.
a. Allocative b. Productive c. Modified d. Marginal