The price system is sometimes criticized in that it
A. leads to greater efficiency.
B. results in allowing the rich get a disproportionate say in what goods and services are produced.
C. coordinates activities without the need for planning by government agencies.
D. relies too heavily on input-output analysis.
Answer: B
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During the housing boom of the mid-2000s, many lenders made mortgage loans to homebuyers who typically had flawed credit histories which made these borrowers high credit risks
These homebuyers were typically charged interest rates that were initially low but would rise after a period of years to very high rates. Homeowners who took out these types of mortgages are often referred to as A) payday borrowers. B) default-risk intermediaries. C) subprime borrowers. D) FHA customers.
According to Edward Denison, during the 1929-1982 period, real output grew at an annual rate of
a. 1.4 percent. b. 0.6 percent. c. 2.9 percent. d. just below 1 percent. e. exactly one-half percent.
If a consumer purchases only two goods (X and Y ) and the demand for X is elastic, then a rise in the price of X
a. will cause total spending on good Y to rise. b. will cause total spending on good Y to fall. c. will cause total spending on good Y to remain unchanged. d. will have an indeterminate effect on total spending on good Y.
If a price searcher is producing at a level of output such that its marginal cost is $16 and its marginal revenue is $9, the firm should
a. increase output in order to reduce per-unit costs. b. decrease the price of its product and expand output. c. increase price and reduce its rate of output. d. reduce both price and output.