According to the cost disease of the personal services, service activities that require direct personal contact
a. tend to fall in price relative to other goods and services.
b. tend to rise in price relative to other goods and services.
c. follow price patterns similar to other goods and services.
d. tend to move up and down in price ignoring the rest of the market.
b
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If Veronica withdraws $1,500 from her savings account and deposits it in her checking account, then M1 will ________ and M2 will ________
A) increase; decrease B) increase; not change C) not change; decrease D) not change; not change
The slope estimator, ?1, has a smaller standard error, other things equal, if
A) there is more variation in the explanatory variable, X. B) there is a large variance of the error term, u. C) the sample size is smaller. D) the intercept, ?0, is small.
Contractionary fiscal policy is enacted when the overall effect of decisions about taxation and spending is to:
A. reduce aggregate demand. B. increase aggregate demand. C. reduce aggregate supply. D. increase aggregate supply.
In a competitive market economy firms will select the least-cost production technique because:
A. such choices will result in full employment of available resources. B. to do so will maximize the firms' profits. C. this will prevent new firms from entering the industry. D. "dollar voting" by consumers mandates such a choice.