A person states that "a large public debt will bankrupt the U.S. government." An economist is likely to respond:
A. yes because this public debt will reduce our ability to borrow the necessary funds from foreign nations.
B. yes because a large public debt means that the U.S. government will not be able to meet its financial obligations.
C. no because the government can refinance the public debt by selling new bonds.
D. no because most of the public debt is held by foreign nations.
Answer: C
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Assume that the supply curve for a commodity shifts to the left and the demand curve shifts to the right, both by the same degree. Then, in comparison to the initial equilibrium, the new equilibrium will be characterized by:
A) a lower price and the same quantity. B) the same price and quantity. C) a lower price and quantity. D) a higher price and the same quantity.
The production possibilities curve shows that:
A. some of one good must be given up to get more of another good in an economy that is operating efficiently. B. no output combination is impossible. C. an economy that is operating efficiently can have more of one good without giving up some of another good. D. scarcity can be eliminated.
Which of the following nontariff barriers (NTBs) may generate revenue for the government?
A. Domestic content requirement B. Import quota C. Voluntary export restraint D. Government procurement
The government may intervene when a specific business practice increases concentration in an already concentrated market.
Answer the following statement true (T) or false (F)