Traffic congestion is an example of a(n)
A. government failure.
B. externality.
C. economy of scale.
D. public good.
Answer: B
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Cable television companies must pay increased charges by the networks for the programs the cable companies carry. As a result, the price of cable television rises. Thus
A) the demand curve for cable television service shifts rightward. B) the demand curve for cable television service shifts leftward. C) there is a movement down the demand curve for cable television to a higher quantity demanded. D) there is a movement up the demand curve for cable television to a smaller quantity demanded.
Of the following exchange rate arrangements, in which does the exchange rate fluctuate around a fixed central target rate while allowing a moderate amount of fluctuation?
A) Independently floating B) Currency Board C) Horizontal Bands D) Fixed peg
Regarding fiscal policy, the new classical economists
a. are in favor of stability. b. attempt to avoid excessive and inflationary stimulus. c. want to avoid erratic government deficit spending. d. All of the above e. None of the above
If a government enacts a price floor on agricultural products to protect wheat farmers, the result is likely going to be
a. an increase in price with a surplus of wheat. b. an increase in price with a shortage of wheat. c. a decrease in price with a surplus of wheat. d. a decrease in price with a shortage of wheat.