In a laissez-faire system, the price mechanism dictates the production planning decisions
a. True
b. False
Indicate whether the statement is true or false
True
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Suppose Alan receives a check for $300 from a bank in Dallas. He deposits the check in his account at his Baltimore bank. Which of the following is Alan's Baltimore bank likely to collect the $300 from?
A. The Baltimore bank's regional Federal Reserve bank. B. The U.S. Treasury. C. The main Federal Reserve Bank in Washington, D.C. D. The Federal Reserve Board of Governors.
The MR = MC profit maximization rule applies:
A. only to monopolies. B. only to purely competitive firms. C. only when the firm is a "price taker." D. to firms in all types of industries.
Even though price elasticity of demand is always ________, by convention its absolute value is always discussed as a ________
A) negative; prime number B) positive; negative number C) a fraction; whole number D) negative; positive number
Assuming no change in the nominal exchange rate, how will a lower rate of inflation in the United States relative to Canada affect the real exchange rate between the two countries? (Assume the United States is the "domestic" country.)
A) The real exchange rate will rise. B) The impact on the real exchange rate cannot be predicted. C) The real exchange rate will be unaffected. D) The real exchange rate will fall.