What three factors that were critical to economic prosperity did Adam Smith observe, and later publish in The Wealth of Nations?
What will be an ideal response?
Smith observed the division of labor, or specialization; he established the link between specialization and exchange, pointing out the inherent nature of humans to further their own self-interest through exchange; he observed that generally, the pursuit of self-interest caused people to behave in ways that were good for society as a whole.
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"A drop in the money supply lowered output in the short run, but left output unaffected in the long run." This statement implies that the price level __________ in the long run, causing the interest rate to __________
A) rose; rise B) rose; fall C) fell; rise D) fell; fall
Government bonds are government securities with terms of
A. one month. B. six months. C. more than one year. D. three months.
What is the largest category of bank assets?
A) loans B) reserves C) securities D) cash items in the process of collection
The poverty rate of the elderly in the United States has
a. been constant since 1959 b. risen since 1959 because people are living longer c. fallen since 1959 because of the growth in Social Security and Medicare programs d. fallen since 1959 because of the growth in private retirement plans e. fallen since 1959, mainly because of inflation