The self-correcting tendency of the economy means that falling inflation eventually eliminates:
A. exogenous spending.
B. recessionary gaps.
C. expansionary gaps.
D. unemployment.
Answer: B
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If demand for Rolls Royce automobiles rises in an area where incomes have increased, this tells us that a Rolls Royce is
A) a normal good. B) an inferior good. C) a complementary good. D) a substitute good.
An increase in U.S. imports from Mexico will cause a decrease in income for Mexican individuals and businesses
a. True b. False Indicate whether the statement is true or false
A pure private good has two characteristics: rivalry and excludability. Rivalry suggests that a private market, rather than the public sector, should produce the good, and excludability suggests a private market will provide it
a. True b. False
Part of the administrative burden of a tax is
a. the money people pay to the government in taxes. b. reducing the size of the market because of the tax. c. the hassle of filling out tax forms that is imposed on taxpayers who comply with the tax. d. the cost of administering programs that use tax revenue.