Compared to a situation where transaction costs are zero, the existence of transaction costs
a. will reduce the volume of trade.
b. will reduce the gains from trade.
c. may lead some buyers and sellers to employ middlemen.
d. All of the above are correct.
D
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Any policy that seeks to influence the level of aggregate demand is called
A) productivity policy. B) stabilization policy. C) aggregate policy. D) employment policy.
Which of the following are not methods of dealing with externalities?
a. relying on voluntary compliance b. creating new property forms c. taxing the output of industries that pollute d. creating legal environmental standards e. increasing public spending on cleanup/reduction
Regulation that keeps the rate of return in the industry competitive is known as
A) rate-of-return regulation. B) cost-of-service regulation. C) social regulation. D) deregulation.
An increase in foreign incomes
A) increases aggregate demand in the United States. B) increases the aggregate quantity demanded in the United States. C) decreases the aggregate quantity demanded in the United States. D) decreases aggregate demand in the United States.